Analyzing Culp (NYSE:CULP) & ON (NYSE:ONON)
by Kim Johansen · The Markets DailyCulp (NYSE:CULP – Get Free Report) and ON (NYSE:ONON – Get Free Report) are both consumer discretionary companies, but which is the superior stock? We will compare the two companies based on the strength of their profitability, valuation, dividends, earnings, institutional ownership, analyst recommendations and risk.
Profitability
This table compares Culp and ON’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Culp | -5.24% | -12.53% | -5.70% |
| ON | 12.09% | 22.92% | 13.33% |
Valuation & Earnings
This table compares Culp and ON”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Culp | $206.76 million | 0.24 | -$19.10 million | ($0.32) | -12.12 |
| ON | $3.64 billion | 6.10 | $245.87 million | $1.47 | 23.65 |
ON has higher revenue and earnings than Culp. Culp is trading at a lower price-to-earnings ratio than ON, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Culp has a beta of 1.21, meaning that its stock price is 21% more volatile than the S&P 500. Comparatively, ON has a beta of 2.08, meaning that its stock price is 108% more volatile than the S&P 500.
Institutional and Insider Ownership
75.1% of Culp shares are owned by institutional investors. Comparatively, 36.4% of ON shares are owned by institutional investors. 7.9% of Culp shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Analyst Recommendations
This is a summary of recent ratings and recommmendations for Culp and ON, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Culp | 1 | 1 | 0 | 0 | 1.50 |
| ON | 1 | 5 | 20 | 2 | 2.82 |
ON has a consensus price target of $43.33, suggesting a potential upside of 24.65%. Given ON’s stronger consensus rating and higher possible upside, analysts plainly believe ON is more favorable than Culp.
Summary
ON beats Culp on 13 of the 15 factors compared between the two stocks.
About Culp
Culp, Inc. manufactures, sources, markets, and sells mattress fabrics, sewn covers, and cut and sewn kits for use in mattresses, foundations, and other bedding products in the United States, North America, the Far East, Asia, and internationally. It operates in two segments, Mattress Fabrics and Upholstery Fabrics. The Mattress Fabrics segment offers woven jacquard, knitted, and converted fabrics for use in the production of bedding products, including mattresses, box springs, foundations, and top of bed components. The Upholstery Fabrics segment provides jacquard woven fabrics, velvets, micro denier suedes, woven dobbies, knitted fabrics, piece-dyed woven products, and polyurethane fabrics for use in the production of residential and commercial upholstered furniture, such as sofas, recliners, loveseats, chairs, sectionals, and sofa-beds, as well as office seating and window treatment products; and installation services for customers in the hospitality and commercial industries. Culp, Inc. was incorporated in 1972 and is headquartered in High Point, North Carolina.
About ON
On Holding AG engages in the development and distribution of sports products such as footwear, apparel, and accessories for high-performance running, outdoor, all-day activities, and tennis. It sells its products worldwide through independent retailers and global distributors, its own online presence, and its own stores. The company was founded by David Allemann, Olivier Bernhard, and Caspar Coppetti in January 2010 and is headquartered in Zurich, Switzerland.