Cato (NYSE:CATO) & Kering (OTCMKTS:PPRUY) Financial Review

Kering (OTCMKTS:PPRUY) and Cato (NYSE:CATO) are both retail/wholesale companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, profitability, risk, institutional ownership, earnings, dividends and analyst recommendations.

Analyst Recommendations

This is a summary of current ratings and target prices for Kering and Cato, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kering	3	5	2	0	1.90
Cato	1	0	0	0	1.00

Insider and Institutional Ownership

1.0% of Kering shares are owned by institutional investors. Comparatively, 61.1% of Cato shares are owned by institutional investors. 18.1% of Cato shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Kering and Cato”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kering	$16.60 billion	2.23	$81.46 million	N/A	N/A
Cato	$653.81 million	0.09	-$5.91 million	($0.31)	-9.60

Kering has higher revenue and earnings than Cato.

Volatility & Risk

Kering has a beta of 1.51, meaning that its share price is 51% more volatile than the S&P 500. Comparatively, Cato has a beta of 0.61, meaning that its share price is 39% less volatile than the S&P 500.

Profitability

This table compares Kering and Cato’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kering	N/A	N/A	N/A
Cato	-0.90%	-3.57%	-1.35%

Summary

Kering beats Cato on 9 of the 11 factors compared between the two stocks.

About Kering

Kering SA manages the development of a series of renowned houses in fashion, leather goods and jewelry in France, the Asia-Pacific, Western Europe, North America, Japan, and internationally. The company offers ready-to-wear products apparel and accessories for men and women. It also offers leather goods and shoes; watches and jewelry; eyewear products; and fragrances and cosmetics. The company provides Gucci, Saint Laurent, Bottega Veneta, Balenciaga, Alexander McQueen, Brioni, Boucheron, Pomellato, DoDo, Qeelin, Ginori 1735, Kering Beauté, and Kering Eyewear brands. The company was formerly known as PPR SA and changed its name to Kering SA in June 2013. Kering SA was founded in 1963 and is based in Paris, France.

About Cato

The Cato Corporation, together with its subsidiaries, operates as a specialty retailer of fashion apparel and accessories primarily in the southeastern United States. It operates through two segments, Retail and Credit. The company's stores and e-commerce websites offer a range of apparel and accessories, including dressy, career, and casual sportswear; and dresses, coats, shoes, lingerie, costume jewelry, and handbags, as well as men's wear, and lines for kids and infants. It operates its stores and e-commerce websites under the Cato, Cato Fashions, Cato Plus, It's Fashion, It's Fashion Metro, and Versona names. It also provides credit card services to its customers, as well as layaway plans for customers. The Cato Corporation was incorporated in 1946 and is headquartered in Charlotte, North Carolina.