Financial Survey: Cabela’s (CAB) versus Big 5 Sporting Goods Corporation (BGFV)

Big 5 Sporting Goods Corporation (NASDAQ: BGFV) and Cabela’s (NYSE:CAB) are both retail/wholesale companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, profitabiliy, risk, earnings, institutional ownership, analyst recommendations and dividends.

Valuation Earnings

This table compares Big 5 Sporting Goods Corporation and Cabela’s’ top-line revenue, earnings per share (EPS) and valuation.

Cabela’s has higher revenue and earnings than Big 5 Sporting Goods Corporation. Big 5 Sporting Goods Corporation is trading at a lower price-to-earnings ratio than Cabela’s, indicating that it is currently the more affordable of the two stocks.

Dividends

Big 5 Sporting Goods Corporation pays an annual dividend of $0.60 per share and has a dividend yield of 4.2%. Cabela’s does not pay a dividend. Big 5 Sporting Goods Corporation pays out 56.1% of its earnings in the form of a dividend.

Analyst Recommendations

This is a summary of recent ratings and target prices for Big 5 Sporting Goods Corporation and Cabela’s, as provided by MarketBeat.com.

Big 5 Sporting Goods Corporation presently has a consensus price target of $17.00, indicating a potential upside of 18.88%. Cabela’s has a consensus price target of $59.36, indicating a potential upside of 3.90%. Given Big 5 Sporting Goods Corporation’s stronger consensus rating and higher possible upside, analysts clearly believe Big 5 Sporting Goods Corporation is more favorable than Cabela’s.

Insider and Institutional Ownership

80.7% of Big 5 Sporting Goods Corporation shares are owned by institutional investors. Comparatively, 58.3% of Cabela’s shares are owned by institutional investors. 7.9% of Big 5 Sporting Goods Corporation shares are owned by company insiders. Comparatively, 21.0% of Cabela’s shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Big 5 Sporting Goods Corporation and Cabela’s’ net margins, return on equity and return on assets.

Volatility and Risk

Big 5 Sporting Goods Corporation has a beta of 0.03, meaning that its stock price is 97% less volatile than the SP 500. Comparatively, Cabela’s has a beta of 0.21, meaning that its stock price is 79% less volatile than the SP 500.

Summary

Cabela’s beats Big 5 Sporting Goods Corporation on 10 of the 16 factors compared between the two stocks.

Big 5 Sporting Goods Corporation Company Profile

Big 5 Sporting Goods Corporation is a sporting goods retailer in the western United States. The Company offers a range of products in a sporting goods store format. The Company also offers products online through its e-commerce platform. The Company’s product mix includes athletic shoes, apparel and accessories, as well as a range of outdoor and athletic equipment for team sports, fitness, camping, hunting, fishing, tennis, golf, winter and summer recreation, and roller sports. The Company purchases merchandise from sporting goods equipment, athletic footwear and apparel manufacturers. It offers various brands, such as adidas, Coleman, Footjoy, JanSport, Rawlings, Spalding, Asics, Columbia, Franklin, Lifetime, Razor, Speedo, Bearpaw, Crocs, Gildan, Mizuno, Rollerblade and Timex. The Company operated 432 stores and an e-commerce platform under the name Big 5 Sporting Goods, as of January 1, 2017.

Cabela’s Company Profile

Cabela’s Incorporated is an omni-channel retailer of hunting, fishing, camping, shooting sports and related outdoor merchandise. The Company offers its customers a selection of national and regional brand products, including its Cabela’s brand. The Company’s segments include Merchandising and Financial Services. The Merchandising segment sells products and services through the Company’s retail stores, its e-commerce Websites (Cabelas.com and Cabelas.ca), and its catalogs. The United States merchandising and Canada merchandising operating segments have been aggregated into its Merchandising segment. The Financial Services segment issues co-branded credit cards, which are available through all of its channels. The Company’s product assortment includes merchandise and equipment for hunting, fishing, marine use, camping, and recreational sport shooting, along with casual and outdoor apparel and footwear, optics, vehicle accessories, and gifts and home furnishings with an outdoor theme.

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