The Shutterfly (SFLY) & Kirkland’s (NASDAQ:KIRK) Critical Survey

The Shutterfly (SFLY) & Kirkland’s (NASDAQ:KIRK) Critical Survey

Valuation and Earnings

Shutterfly (NASDAQ: SFLY) and Kirkland’s (NASDAQ:KIRK) are both small-cap computer and technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their earnings, valuation, risk, institutional ownership, profitabiliy, analyst recommendations and dividends.

This table compares Shutterfly and Kirkland’s’ gross revenue, earnings per share (EPS) and valuation.

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

Analyst Ratings

This is a summary of current ratings for Shutterfly and Kirkland’s, as reported by MarketBeat.com.

Shutterfly presently has a consensus target price of $53.50, indicating a potential upside of 8.83%. Kirkland’s has a consensus target price of $14.17, indicating a potential upside of 53.15%. Given Kirkland’s’ stronger consensus rating and higher possible upside, analysts clearly believe Kirkland’s is more favorable than Shutterfly.

Institutional and Insider Ownership

88.6% of Kirkland’s shares are held by institutional investors. 5.7% of Shutterfly shares are held by company insiders. Comparatively, 7.8% of Kirkland’s shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Shutterfly and Kirkland’s’ net margins, return on equity and return on assets.

Risk & Volatility

Shutterfly has a beta of 0.85, suggesting that its stock price is 15% less volatile than the S&P 500. Comparatively, Kirkland’s has a beta of 1.26, suggesting that its stock price is 26% more volatile than the S&P 500.

Summary

Kirkland’s beats Shutterfly on 10 of the 15 factors compared between the two stocks.

Shutterfly Company Profile

Shutterfly, Inc. is an online manufacturer and retailer of personalized products and services. The Company focuses on helping consumers manage their memories through the medium of photography. The Company’s segments are Consumer and Shutterfly Business Solutions (SBS). The Consumer segment offers photo-based products, such as photo books, stationery and greeting cards, other photo-based merchandise, photo prints and statement gifts. The SBS segment includes printing and shipping of direct marketing and other variable data print products and formats. The Company provides a range of personalized photo-based products and services that enables the consumers to upload, edit, organize, find, share, create, print, and preserve their memories in a thoughtful manner. The Company’s brands include Shutterfly, Tiny Prints, Wedding Paper Divas, MyPublisher, BorrowLenses and Groovebook. The Company has its production facilities in Fort Mill, South Carolina; Shakopee, Minnesota, and Tempe, Arizona.

Kirkland’s Company Profile

Kirkland’s, Inc. is a specialty retailer of home decor and gifts in the United States. The Company’s merchandise categories include wall decor, art, mirrors, lamps, decorative accessories, accent furniture, textiles, fragrance and accessories, frames, housewares, impulse and personal accessories, outdoor living and artificial floral products. The Company’s stores also offer a range of holiday merchandise during seasonal periods, as well as items carried throughout the year suitable for gift-giving. The Company’s average stores generally carry approximately 4,700 Stock Keeping Units (SKUs). The Company’s stores operate under various names, such as Kirkland’s, Kirkland’s Home, Kirkland’s Home Outlet, Kirkland’s Outlet and The Kirkland Collection. It operates approximately 380 stores in over 30 states, as well as an e-commerce enabled Website, www.kirklands.com. Its stores’ locations include Texas, Florida, California, Georgia, North Carolina, Alabama, Arizona, Virginia and Ohio.

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