GAP (NYSE:GPS – Get Free Report) and Roots (OTCMKTS:RROTF – Get Free Report) are both consumer cyclical companies, but which is the better business? We will compare the two businesses based on the strength of their valuation, risk, earnings, profitability, institutional ownership, dividends and analyst recommendations.
Analyst Ratings
This is a summary of current ratings for GAP and Roots, as reported by MarketBeat.
Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
GAP | 0 | 7 | 8 | 0 | 2.53 |
Roots | 0 | 0 | 0 | 0 | N/A |
GAP currently has a consensus price target of $27.08, indicating a potential upside of ∞. Given GAP’s higher probable upside, research analysts plainly believe GAP is more favorable than Roots.
Earnings & Valuation
Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
GAP | $15.00 billion | 0.00 | $502.00 million | $1.80 | N/A |
Roots | N/A | N/A | N/A | N/A | N/A |
GAP has higher revenue and earnings than Roots.
Insider and Institutional Ownership
58.8% of GAP shares are held by institutional investors. 30.8% of GAP shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Profitability
This table compares GAP and Roots’ net margins, return on equity and return on assets.
Net Margins | Return on Equity | Return on Assets | |
GAP | 4.52% | 27.57% | 6.30% |
Roots | N/A | N/A | N/A |
Summary
GAP beats Roots on 8 of the 8 factors compared between the two stocks.
About GAP
The Gap, Inc. operates as an apparel retail company. The company offers apparel, accessories, and personal care products for men, women, and children under the Old Navy, Gap, Banana Republic, and Athleta brands. Its products include adult apparel and accessories; and fitness and lifestyle products for use in yoga, training, sports, travel, and everyday activities for women and girls. The company offers its products through company-operated stores, franchise stores, websites, and third-party arrangements. It has franchise agreements to operate Old Navy, Gap, Banana Republic, and Athleta stores and websites in Asia, Europe, Latin America, the Middle East, and Africa. The Gap, Inc. was incorporated in 1969 and is headquartered in San Francisco, California.
About Roots
Roots Corporation, together with its subsidiaries, designs, markets, and sells apparel, leather goods, footwear, and accessories under the Roots brand in Canada and internationally. The company operates through two segments, Direct-To-Consumer, and Partners and Other. The Direct-to-Consumer segment sells products through the company's corporate retail stores and ecommerce. The Partners and Other segment involved in the wholesale of Roots branded products to the company's international operating partners, licensees, and wholesale customers. Roots Corporation was founded in 1973 and is headquartered in Toronto, Canada.
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