DICK’S Sporting Goods (NYSE:DKS) vs. Tractor Supply (NASDAQ:TSCO) Financial Contrast

DICK’S Sporting Goods (NYSE:DKS) and Tractor Supply (NASDAQ:TSCO) are both large-cap retail/wholesale companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, earnings, dividends, risk, profitability, analyst recommendations and institutional ownership.

Insider & Institutional Ownership

89.8% of DICK’S Sporting Goods shares are held by institutional investors. Comparatively, 98.7% of Tractor Supply shares are held by institutional investors. 32.6% of DICK’S Sporting Goods shares are held by company insiders. Comparatively, 0.7% of Tractor Supply shares are held by company 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 breakdown of recent recommendations for DICK’S Sporting Goods and Tractor Supply, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DICK’S Sporting Goods	0	10	9	0	2.47
Tractor Supply	0	8	13	0	2.62

DICK’S Sporting Goods currently has a consensus target price of $221.50, indicating a potential upside of 3.81%. Tractor Supply has a consensus target price of $61.80, indicating a potential upside of 6.86%. Given Tractor Supply’s stronger consensus rating and higher possible upside, analysts plainly believe Tractor Supply is more favorable than DICK’S Sporting Goods.

Earnings and Valuation

This table compares DICK’S Sporting Goods and Tractor Supply”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DICK’S Sporting Goods	$13.44 billion	1.27	$1.17 billion	$13.98	15.26
Tractor Supply	$14.88 billion	2.06	$1.10 billion	$2.04	28.35

DICK’S Sporting Goods has higher earnings, but lower revenue than Tractor Supply. DICK’S Sporting Goods is trading at a lower price-to-earnings ratio than Tractor Supply, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares DICK’S Sporting Goods and Tractor Supply’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
DICK’S Sporting Goods	8.49%	38.06%	11.28%
Tractor Supply	7.18%	46.83%	10.73%

Risk & Volatility

DICK’S Sporting Goods has a beta of 1.07, suggesting that its stock price is 7% more volatile than the S&P 500. Comparatively, Tractor Supply has a beta of 0.75, suggesting that its stock price is 25% less volatile than the S&P 500.

Dividends

DICK’S Sporting Goods pays an annual dividend of $4.85 per share and has a dividend yield of 2.3%. Tractor Supply pays an annual dividend of $0.92 per share and has a dividend yield of 1.6%. DICK’S Sporting Goods pays out 34.7% of its earnings in the form of a dividend. Tractor Supply pays out 45.1% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. DICK’S Sporting Goods has increased its dividend for 11 consecutive years and Tractor Supply has increased its dividend for 16 consecutive years. DICK’S Sporting Goods is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Tractor Supply beats DICK’S Sporting Goods on 9 of the 17 factors compared between the two stocks.

About DICK’S Sporting Goods

Dick’s Sporting Goods, Inc. engages in the retailing of an extensive assortment of authentic sports equipment, apparel, footwear, and accessories. It also offers its products both online and through mobile applications. The company was founded by Richard T. Stack in 1948 and is headquartered in Coraopolis, PA.

About Tractor Supply

Tractor Supply Company operates as a rural lifestyle retailer in the United States. The company offers various merchandise, including livestock and equine feed and equipment, poultry, fencing, and sprayers and chemicals; food, treats, and equipment for dogs, cats, and other small animals, as well as dog wellness products; seasonal and recreation products comprising tractors and riders, lawn and garden, bird feeding, power equipment, and other recreational products; truck, tool, and hardware products, such as truck accessories, trailers, generators, lubricants, batteries, and hardware and tools; and clothing, gift, and décor products consist of clothing, footwear, toys, snacks, and decorative merchandise. It provides its products under the 4health, Paws & Claws, American Farmworks, Producer's Pride, Bit & Bridle, Red Shed, Blue Mountain, Redstone, C.E. Schmidt, Retriever, Country Lane, Ridgecut, Countyline, Royal Wing, Country Tuff, Strive, Dumor, Traveller, Farm Table, Treeline, Groundwork, TSC Tractor Supply Co, Huskee, Untamed, and JobSmart brand names. The company operates its retail stores under the Tractor Supply Company, Petsense by Tractor Supply, and Orscheln Farm and Home names; and operates websites under the TractorSupply.com and Petsense.com names. It sells its products to recreational farmers, ranchers, and others. Tractor Supply Company was founded in 1938 and is based in Brentwood, Tennessee.