Financial Analysis: Vipshop (VIPS) versus Nutrisystem (NTRI)

Nutrisystem (NASDAQ: NTRI) and Vipshop (NYSE:VIPS) are both consumer discretionary companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, earnings, dividends, risk, analyst recommendations, valuation and institutional ownership.

Analyst Recommendations

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This is a breakdown of current ratings and price targets for Nutrisystem and Vipshop, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Nutrisystem 0 3 6 0 2.67
Vipshop 0 3 9 0 2.75

Nutrisystem currently has a consensus price target of $56.89, suggesting a potential upside of 100.31%. Vipshop has a consensus price target of $16.88, suggesting a potential upside of 5.65%. Given Nutrisystem’s higher probable upside, equities analysts plainly believe Nutrisystem is more favorable than Vipshop.

Profitability

This table compares Nutrisystem and Vipshop’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Nutrisystem 8.30% 48.69% 31.00%
Vipshop 2.67% 25.75% 8.08%

Valuation & Earnings

This table compares Nutrisystem and Vipshop’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Nutrisystem $696.96 million 1.22 $57.87 million $1.96 14.49
Vipshop $11.21 billion 0.94 $299.65 million $0.58 27.55

Vipshop has higher revenue and earnings than Nutrisystem. Nutrisystem is trading at a lower price-to-earnings ratio than Vipshop, indicating that it is currently the more affordable of the two stocks.

Dividends

Nutrisystem pays an annual dividend of $1.00 per share and has a dividend yield of 3.5%. Vipshop does not pay a dividend. Nutrisystem pays out 51.0% of its earnings in the form of a dividend.

Insider & Institutional Ownership

48.0% of Vipshop shares are owned by institutional investors. 2.0% of Nutrisystem shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Volatility & Risk

Nutrisystem has a beta of 1.12, indicating that its share price is 12% more volatile than the S&P 500. Comparatively, Vipshop has a beta of 2.27, indicating that its share price is 127% more volatile than the S&P 500.

Nutrisystem Company Profile

Nutrisystem, Inc., together with its subsidiaries, provides weight management products and services for women and men in the United States. The company offers weight loss programs that consist primarily of a pre-packaged food program, digital tools, and counseling. It also provides Nutrisystem Lean13 program, which provides weight loss, and support and counseling services; the South Beach Diet, a weight-loss program; and Nutrisystem 5-day kit, a ?D' kit that offers individuals with or at risk of type 2 diabetes. In addition, the company provides SmartCarb and PowerFuel products, including meal replacement bars, powder shakes, baked goods and snacks; and Nutrisystem D Program, a weight loss program designed to produce gradual weight loss. It sells its pre-packaged foods to weight loss program participants directly through the Internet and telephone; a television shopping network; and retailers. Nutrisystem, Inc. was founded in 1972 and is headquartered in Fort Washington, Pennsylvania.

Vipshop Company Profile

Vipshop Holdings Limited, through its subsidiaries, operates as an online discount retailer for various brands in the People's Republic of China. It offers a range of branded products, including women's apparel, such as casual wear, jeans, dresses, outerwear, swimsuits, lingerie, pajamas, and maternity clothes; men's apparel comprising casual and smart-casual T-shirts, polo shirts, jackets, pants, and underwear; women and men shoes for casual and formal occasions; and accessories consisting of belts, fashionable jewelry, watches, and glasses for women and men. The company also provides handbags, such as purses, satchels, duffel bags, and wallets; apparel, gear and accessories, furnishings and decor, toys, and games for boys, girls, infants, and toddlers of all age groups; sports apparel, and sports gear, and footwear for tennis, badminton, soccer, and swimming; and skin care and cosmetic products, including cleansers, lotions, face and body creams, face masks, sunscreen, foundations, lipsticks, eye shadows, and nail polish. In addition, it offers home furnishing products comprising bedding and bath products, home decors, and dining and tabletop items; small household appliances; designer apparel, footwear and accessories; and snacks, health supplements, and occasion-based gifts, such as chocolates, moon-cakes, and tea. Further, the company provides consumer financing, supply chain financing, and wealth management services. The company provides its branded products through its vipshop.com, vip.com, and lefeng.com Websites, as well as through its cellular phone application. Vipshop Holdings Limited was founded in 2008 and is headquartered in Guangzhou, the People's Republic of China.

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