Contrasting Deckers Outdoor (NYSE:DECK) and Zalando (OTCMKTS:ZLNDY)

Zalando (OTCMKTS:ZLNDY) and Deckers Outdoor (NYSE:DECK) are both retail/wholesale companies, but which is the better business? We will compare the two businesses based on the strength of their analyst recommendations, dividends, valuation, risk, profitability, institutional ownership and earnings.

Analyst Ratings

This is a summary of current ratings for Zalando and Deckers Outdoor, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Zalando	1	3	2	1	2.43
Deckers Outdoor	2	13	9	0	2.29

Deckers Outdoor has a consensus price target of $121.11, suggesting a potential upside of 14.05%. Given Deckers Outdoor’s higher possible upside, analysts clearly believe Deckers Outdoor is more favorable than Zalando.

Volatility and Risk

Zalando has a beta of 1.51, meaning that its share price is 51% more volatile than the S&P 500. Comparatively, Deckers Outdoor has a beta of 1.17, meaning that its share price is 17% more volatile than the S&P 500.

Profitability

This table compares Zalando and Deckers Outdoor’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Zalando	0.89%	4.15%	1.32%
Deckers Outdoor	18.90%	41.19%	26.84%

Valuation & Earnings

This table compares Zalando and Deckers Outdoor”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Zalando	$13.97 billion	0.57	$243.36 million	$0.26	59.62
Deckers Outdoor	$5.47 billion	2.69	$1.02 billion	$7.04	15.08

Deckers Outdoor has lower revenue, but higher earnings than Zalando. Deckers Outdoor is trading at a lower price-to-earnings ratio than Zalando, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

97.8% of Deckers Outdoor shares are owned by institutional investors. 0.4% of Deckers Outdoor shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Summary

Deckers Outdoor beats Zalando on 10 of the 15 factors compared between the two stocks.

About Zalando

Zalando SE operates an online platform for fashion and lifestyle products. The company operates through Fashion Store and Offprice segments. It provides shoes, apparel, accessories, and beauty products with free delivery and returns, as well as various payment options. The company also sells its products through Lounge by Zalando; and brick-and-mortar outlet stores. It operates in Germany, Austria, Switzerland, Belgium, Croatia, the Czech Republic, Denmark, Estonia, Finland, Hungary, France, Ireland, Italy, Latvia, Lithuania, Luxembourg, the Netherlands, Norway, Poland, Romania, Slovakia, Slovenia, Spain, Sweden, and the United Kingdom. The company was founded in 2008 and is headquartered in Berlin, Germany.

About Deckers Outdoor

Deckers Outdoor Corporation, together with its subsidiaries, designs, markets, and distributes footwear, apparel, and accessories for casual lifestyle use and high-performance activities in the United States and internationally. The company offers premium footwear, apparel, and accessories under the UGG brand name; footwear, apparel, and accessories for ultra-runners and athletes under the HOKA brand name; and sandals, shoes, and boots under the Teva brand name. It also provides relaxed casual shoes and sandals under the Sanuk brand name; casual footwear fashion line under the Koolaburra brand name; and footwear under the AHNU brand name. The company sells its products through domestic and international retailers; international distributors; and directly to its consumers through its direct-to-consumer business, which includes e-commerce websites and retail stores. Deckers Outdoor Corporation was founded in 1973 and is headquartered in Goleta, California.