Xtep International (OTCMKTS:XTEPY – Get Free Report) and Rocky Brands (NASDAQ:RCKY – Get Free Report) are both small-cap consumer discretionary companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, valuation, earnings, risk, dividends, profitability and analyst recommendations.
Dividends
Xtep International pays an annual dividend of $2.29 per share and has a dividend yield of 4.5%. Rocky Brands pays an annual dividend of $0.62 per share and has a dividend yield of 1.7%. Rocky Brands pays out 25.1% of its earnings in the form of a dividend.
Insider & Institutional Ownership
75.1% of Rocky Brands shares are owned by institutional investors. 7.6% of Rocky Brands shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Xtep International | 0 | 1 | 0 | 0 | 2.00 |
| Rocky Brands | 0 | 3 | 1 | 0 | 2.25 |
Rocky Brands has a consensus target price of $42.00, suggesting a potential upside of 17.48%. Given Rocky Brands’ stronger consensus rating and higher possible upside, analysts clearly believe Rocky Brands is more favorable than Xtep International.
Profitability
This table compares Xtep International and Rocky Brands’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Xtep International | N/A | N/A | N/A |
| Rocky Brands | 3.78% | 8.43% | 4.35% |
Volatility & Risk
Xtep International has a beta of 0.2, meaning that its share price is 80% less volatile than the S&P 500. Comparatively, Rocky Brands has a beta of 2.39, meaning that its share price is 139% more volatile than the S&P 500.
Valuation and Earnings
This table compares Xtep International and Rocky Brands”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Xtep International | $1.97 billion | 0.73 | $190.79 million | N/A | N/A |
| Rocky Brands | $481.98 million | 0.56 | $22.27 million | $2.47 | 14.47 |
Xtep International has higher revenue and earnings than Rocky Brands.
Summary
Rocky Brands beats Xtep International on 9 of the 14 factors compared between the two stocks.
About Xtep International
Xtep International Holdings Limited engages in the design, development, manufacture, sale, and marketing and brand management of sports footwear, apparel, and accessories. The company sells its products primarily under the XTEP brand, as well as Palladium, K-Swiss, Saucony, and Merrell brand names. It is also involved in the trading of sportswear products. As of March 18, 2021, the company managed an extensive distribution network with exclusive distributors that operated approximately 6,000 stores covering 31 provinces, autonomous regions, and municipalities in the People's Republic of China and internationally. It also offers its products online. The company was founded in 1999 and is headquartered in Xiamen, the People's Republic of China. Xtep International Holdings Limited is a subsidiary of Group Success Investments Limited.
About Rocky Brands
Rocky Brands, Inc. designs, manufactures, and markets footwear and apparel in the United States, Canada, and internationally. It operates through Wholesale, Retail, and Contract Manufacturing segments. The Wholesale segment offers products, which includes sporting goods stores, outdoor retailers, independent shoe retailers, hardware stores, catalogs, mass merchants, uniform stores, farm store chains, specialty safety stores, specialty retailers, and online retailers in retail locations through a range of distribution channels. Retail segment sells its products directly to consumers through its websites comprising rockyboots.com, georgiaboot.com, durangoboot.com, muckbootcompany.com, xtratuf.com, lehighoutfitters.com, lehighsafetyshoes.com, and slipgrips.com; and third-party marketplaces and Rocky Outdoor Gear Stores. The Contract Manufacturing segment include private label sales and any sales to customers which are contracted to manufacture a specific footwear product for a customer and include sales to the U.S. Military. In addition, it serves industrial and construction workers, as well as workers in the hospitality industry, such as restaurants or hotels; farmers and ranchers; western; commercial military personnel; hunting, fishing, camping, and hiking enthusiasts; law enforcement, security personnel, and postal employees; and for the U.S. military personnel. The company sells its products under the Rocky, Georgia Boot, Durango, Lehigh, Muck, XTRATUF, Servus, Ranger, and Michelin brand names Rocky Brands, Inc. was formerly known as William Brooks Shoe Co. The company was founded in 1932 and is headquartered in Nelsonville, Ohio.
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