Contrasting L Brands (LTD) & Xcel Brands (XELB)

L Brands (NYSE: LTD) and Xcel Brands (NASDAQ:XELB) are both cyclical consumer goods & services companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, profitability, risk, analyst recommendations, dividends, valuation and institutional ownership.

Institutional & Insider Ownership

17.3% of Xcel Brands shares are owned by institutional investors. 62.2% of Xcel Brands shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares L Brands and Xcel Brands’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
L Brands 5.05% N/A 7.13%
Xcel Brands 8.38% 0.99% 0.70%

Analyst Ratings

This is a breakdown of current ratings and target prices for L Brands and Xcel Brands, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
L Brands 0 0 0 0 N/A
Xcel Brands 0 0 1 0 3.00

Xcel Brands has a consensus price target of $4.50, suggesting a potential upside of 15.38%. Given Xcel Brands’ higher possible upside, analysts clearly believe Xcel Brands is more favorable than L Brands.

Earnings & Valuation

This table compares L Brands and Xcel Brands’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
L Brands N/A N/A N/A N/A N/A
Xcel Brands $32.08 million 1.94 $4.00 million $0.14 27.86

Xcel Brands has higher revenue and earnings than L Brands.

Summary

Xcel Brands beats L Brands on 7 of the 8 factors compared between the two stocks.

L Brands Company Profile

L Brands, Inc. operates specialty retail business. The Company is focused on women’s intimate and other apparel, personal care, beauty and home fragrance categories. Its segments include Victoria’s Secret, Bath & Body Works, and Victoria’s Secret and Bath & Body Works International. It sells its merchandise through company-owned specialty retail stores in the United States, Canada, the United Kingdom and Greater China, which are mall-based; through Websites, and through international franchise, license and wholesale partners. It operates in the retail brands, which include Victoria’s Secret, PINK, Bath & Body Works and La Senza. La Senza is a specialty retailer of women’s intimate apparel. It sells its La Senza products at over 120 La Senza stores in Canada. Henri Bendel sells handbags, jewelry and other accessory products through New York and 28 other stores. Mast Global is a merchandise sourcing and production function serving the Company and its international partners.

Xcel Brands Company Profile

Xcel Brands, Inc. is a brand development and media company. The Company is engaged in the design, production, licensing, marketing, and direct to consumer sales of branded apparel, footwear, accessories, jewelry, home goods, and other consumer products, and the acquisition of consumer lifestyle brands. The Company’s brand portfolio consists of the Isaac Mizrahi, Judith Ripka, H Halston, C Wonder and Highline Collective brands. The Company also manages and designs the Liz Claiborne New York brand (LCNY Brand). Isaac Mizrahi has over 150 different product categories, including sportswear, footwear, handbags, watches, eyewear, fragrance, tech accessories, intimates, bridal gowns and accessories, pet products, home and other merchandise. The Company’s Judith Ripka is a luxury jewelry brand. Wonder brand offers women’s clothing, footwear, jewelry and accessories; housewares, and home decor and gifts. The Liz Claiborne New York includes women’s apparel, footwear, outerwear and accessories.

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