Head-To-Head Comparison: Genesco (GCO) and Foot Locker (NYSE:FL)

Foot Locker (NYSE: FL) and Genesco (NYSE:GCO) are both retail/wholesale companies, but which is the better stock? We will compare the two businesses based on the strength of their valuation, profitability, dividends, analyst recommendations, risk, earnings and institutional ownership.

Valuation & Earnings

This table compares Foot Locker and Genesco’s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	EBITDA	Earnings Per Share	Price/Earnings Ratio
Foot Locker	$7.78 billion	0.58	$1.13 billion	$4.89	7.03
Genesco	$2.86 billion	0.16	$199.22 million	$4.46	5.36

Foot Locker has higher revenue and earnings than Genesco. Genesco is trading at a lower price-to-earnings ratio than Foot Locker, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Foot Locker and Genesco’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Foot Locker	8.39%	23.87%	16.90%
Genesco	3.07%	8.41%	4.94%

Institutional & Insider Ownership

93.5% of Foot Locker shares are owned by institutional investors. 2.9% of Foot Locker shares are owned by insiders. Comparatively, 3.3% of Genesco shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Dividends

Foot Locker pays an annual dividend of $1.24 per share and has a dividend yield of 3.6%. Genesco does not pay a dividend. Foot Locker pays out 25.4% of its earnings in the form of a dividend. Foot Locker has increased its dividend for 6 consecutive years.

Analyst Ratings

This is a breakdown of current ratings for Foot Locker and Genesco, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Foot Locker	1	11	13	0	2.48
Genesco	0	3	4	0	2.57

Foot Locker presently has a consensus price target of $71.14, indicating a potential upside of 106.91%. Genesco has a consensus price target of $45.17, indicating a potential upside of 88.98%. Given Foot Locker’s higher probable upside, equities analysts plainly believe Foot Locker is more favorable than Genesco.

Volatility & Risk

Foot Locker has a beta of 0.68, indicating that its stock price is 32% less volatile than the S&P 500. Comparatively, Genesco has a beta of 1.24, indicating that its stock price is 24% more volatile than the S&P 500.

Summary

Foot Locker beats Genesco on 13 of the 17 factors compared between the two stocks.

Foot Locker Company Profile

Foot Locker, Inc. is a retailer of shoes and apparel. The Company operates through two segments: Athletic Stores and Direct-to-Customers. The Company is an athletic footwear and apparel retailer, which include businesses, such as include Foot Locker, Kids Foot Locker, Lady Foot Locker, Champs Sports, Footaction, Runners Point, Sidestep and SIX:02. The Direct-to-Customers segment is multi-branded and sells directly to customers through Internet and mobile sites and catalogs. The Direct-to-Customers segment operates the Websites for eastbay.com, final-score.com, eastbayteamsales.com and sp24.com. Additionally, this segment includes the Websites, both desktop and mobile, aligned with the brand names of its store banners (footlocker.com, ladyfootlocker.com, six02.com kidsfootlocker.com, champssports.com, footaction.com, footlocker.ca, footlocker.eu, runnerspoint.com and sidestep-shoes.com).

Genesco Company Profile

Genesco Inc. is a retailer and wholesaler of footwear, apparel and accessories. The Company operates in five segments: Journeys Group, Schuh Group, Lids Sports Group, Johnston & Murphy Group and Licensed Brands. It relies on independent third-party manufacturers for production of its footwear products sold at wholesale. It sources footwear and accessory products from foreign manufacturers located in Bangladesh, Brazil, Cambodia, Canada, China, Dominican Republic, El Salvador, France, Germany, Hong Kong, India, Indonesia, Italy, Mexico, the Netherlands, Portugal, Peru, Romania, Taiwan and Vietnam. As of January 28, 2017, it operated 2,794 retail footwear, headwear and sports apparel and accessory stores and leased departments located primarily throughout the United States and in Puerto Rico, including 147 headwear and sports apparel and accessory stores and 87 footwear stores in Canada and 128 footwear stores in the United Kingdom, the Republic of Ireland and Germany.