Analyzing Container Store Group (TCS) and Bed Bath & Beyond (BBBY)

Bed Bath & Beyond (NASDAQ: BBBY) and Container Store Group (NYSE:TCS) are both retail/wholesale companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, dividends, profitability, institutional ownership, risk, analyst recommendations and valuation.

Profitability

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This table compares Bed Bath & Beyond and Container Store Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Bed Bath & Beyond 3.44% 16.45% 6.51%
Container Store Group 3.34% 5.91% 1.75%



Analyst Recommendations

This is a summary of recent ratings and target prices for Bed Bath & Beyond and Container Store Group, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Bed Bath & Beyond 10 11 1 0 1.59
Container Store Group 1 2 0 0 1.67

Bed Bath & Beyond presently has a consensus target price of $22.41, suggesting a potential upside of 25.49%. Container Store Group has a consensus target price of $4.83, suggesting a potential downside of 21.15%. Given Bed Bath & Beyond’s higher probable upside, analysts plainly believe Bed Bath & Beyond is more favorable than Container Store Group.

Insider & Institutional Ownership

92.8% of Bed Bath & Beyond shares are owned by institutional investors. Comparatively, 79.0% of Container Store Group shares are owned by institutional investors. 5.0% of Bed Bath & Beyond shares are owned by insiders. Comparatively, 65.7% of Container Store Group shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Bed Bath & Beyond and Container Store Group’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Bed Bath & Beyond $12.35 billion 0.20 $424.85 million $3.12 5.72
Container Store Group $819.93 million 0.36 $14.95 million $0.26 23.58

Bed Bath & Beyond has higher revenue and earnings than Container Store Group. Bed Bath & Beyond is trading at a lower price-to-earnings ratio than Container Store Group, indicating that it is currently the more affordable of the two stocks.

Dividends

Bed Bath & Beyond pays an annual dividend of $0.60 per share and has a dividend yield of 3.4%. Container Store Group does not pay a dividend. Bed Bath & Beyond pays out 19.2% of its earnings in the form of a dividend.

Volatility and Risk

Bed Bath & Beyond has a beta of 1, indicating that its stock price has a similar volatility profile to the S&P 500.Comparatively, Container Store Group has a beta of 1.49, indicating that its stock price is 49% more volatile than the S&P 500.

Summary

Bed Bath & Beyond beats Container Store Group on 10 of the 16 factors compared between the two stocks.

Bed Bath & Beyond Company Profile

Bed Bath & Beyond Inc., together with its subsidiaries, operates a chain of retail stores. It sells a range of domestics merchandise, including bed linens and related items, bath items, and kitchen textiles; and home furnishings, such as kitchen and tabletop items, fine tabletop, basic housewares, general home furnishings, consumables, and juvenile products. It also provides various textile products, amenities, and other goods to institutional customers in the hospitality, cruise line, healthcare, and other industries. As of December 20, 2017, the company had a total of 1,558 stores, includes 1,020 Bed Bath & Beyond stores in 50 states, the District of Columbia, Puerto Rico, and Canada; 280 stores under the names of World Market, Cost Plus World Market, or Cost Plus; 118 buybuy BABY stores; 83 stores under the Christmas Tree Shops, Christmas Tree Shops andThat! or andThat! names; and 57 stores under the Harmon, Harmon Face Values, or Face Values. It also offers products through various Websites and applications, such as bedbathandbeyond.com, bedbathandbeyond.ca, harmondiscount.com, christmastreeshops.com, buybuybaby.com, buybuybaby.ca, harborlinen.com, t-ygroup.com, and worldmarket.com. In addition, the Company operates Of a Kind, an e-commerce Website that features specially commissioned limited edition items from emerging fashion and home designers; One Kings Lane, an online authority in home décor and design that offers a collection of selected home goods, and designer and vintage items; PersonalizationMall.com, an online retailer of personalized products; Chef Central, an online retailer of kitchenware, cookware, and homeware items catering to cooking and baking enthusiasts; and Decorist, an online interior design platform that provides personalized home design services. Bed Bath & Beyond Inc. was founded in 1971 and is based in Union, New Jersey.

Container Store Group Company Profile

The Container Store Group, Inc. engages in the retailing of storage and organization products and solutions in the United States. The company operates through two segments, The Container Store and Elfa. Its retail stores provide various lifestyle products, including bath, box, closets, collections, containers, gift packaging, hooks, kitchen, laundry, office, shelving, storage, trash, and travel, as well as elfa branded products. The company also designs, manufactures, and sells component-based shelving and drawer systems that are customizable for any area of the home, such as closets, kitchens, offices, and garages, as well as made-to-measure sliding doors. As of April 1 2017, it operated 86 stores. The company also offers its products directly to customers through its Website and call center, as well as sells to various retailers and distributors, and on a wholesale basis. The Container Store Group, Inc. was founded in 1978 and is headquartered in Coppell, Texas.

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