Critical Survey: Stage Stores (OTCMKTS:SSINQ) and GAP (NYSE:GAP)

Stage Stores (OTCMKTS:SSINQ) and GAP (NYSE:GAP) are both retail/wholesale companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, dividends, valuation, earnings, risk, analyst recommendations and profitability.

Valuation & Earnings

This table compares Stage Stores and GAP”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Stage Stores	N/A	N/A	N/A	N/A	N/A
GAP	$14.89 billion	0.63	$502.00 million	$2.16	11.51

GAP has higher revenue and earnings than Stage Stores.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Stage Stores and GAP, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Stage Stores	0	0	0	0	0.00
GAP	1	5	5	0	2.36

GAP has a consensus price target of $28.30, suggesting a potential upside of 13.79%. Given GAP’s stronger consensus rating and higher probable upside, analysts plainly believe GAP is more favorable than Stage Stores.

Institutional & Insider Ownership

58.8% of GAP shares are owned by institutional investors. 11.6% of Stage Stores shares are owned by insiders. Comparatively, 31.0% of GAP shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Profitability

This table compares Stage Stores and GAP’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Stage Stores	N/A	N/A	N/A
GAP	5.40%	30.10%	7.38%

Summary

GAP beats Stage Stores on 9 of the 9 factors compared between the two stocks.

About Stage Stores

Stage Stores, Inc. operates specialty department stores primarily in small towns and rural communities in the United States. The company sells moderately priced and brand name apparel, accessories, cosmetics, footwear, and home goods through its department stores, off-price stores, and e-commerce Website, as well as through private label credit card and loyalty programs. As of September 17, 2019, it operated 625 BEALLS, GOODY'S, PALAIS ROYAL, PEEBLES, and STAGE specialty department stores; and 158 GORDMANS off-price stores. The company was founded in 1988 and is headquartered in Houston, Texas. On May 10, 2020, Stage Stores, Inc., along with its affiliate, filed a voluntary petition for reorganization under Chapter 11 in the U.S. Bankruptcy Court for the Southern District of Texas. The plan was later approved as Chapter 11 liquidation on August 14, 2020.

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.