The Men’s Wearhouse, Inc. (MW), Jos. A. Bank Clothiers Inc (JOSB): This Stock Is Dressing Up

ANN has two key segments, offering its customers (women) a more professional offering with Ann Taylor, and a more “relaxed” clothing line with LOFT. Total brand same-store sales were up 6.2% for its October-end quarter, which helped the company post EPS of $0.05, compared to the $0.04 for the same quarter last year. The company still managed to see year over year growth despite Hurricane Sandy’s impact on the Northeast, and the future is bright for the company, which is expected to be driven by its mix-shift between factory and outlet channels.

Francesca’s Holdings Corp (NASDAQ:FRAN)

is another specialty retailer, owning a string of retail boutiques in the U.S. Like some of the other retailers, Francesca’s expects a bright future, with full year 2013 earnings expected to grow 23%-26% year over year. This comes after the company posted fourth-quarter earnings of $0.33, beating analysts’ estimates of $0.30.

However, the stock could be trading a bit high from a valuation prospective. The company is now trading at 32 times earnings and 4.3 times sales, well above any of the other companies listed, or any major peer. What’s more is that a number of investors believe that the stock could be overvalued, with the stock having a high level of short interest, around 45% as of the end of February (check out other reasons why Francesca’s might still be a buy).

Don’t be fooled

Although Men’s Wearhouse has seen a nice move of late, there is still upside for the company. A big advantage for Men’s Wearhouse is its initiative to return cash to shareholders. The company pays a 2.1% dividend yield, whereas none of the other stocks listed pay a dividend at all.

I believe The Men’s Wearhouse, Inc. (NYSE:MW) is a good stock to own and should trade above chief rival, Jos. A. Bank Clothiers Inc (NASDAQ:JOSB), on a multiple basis. The two trade with similar price to earnings ratios, and Men’s Wearhouse has a price to sales ratio that’s half that of Jos. A. Bank Clothiers Inc (NASDAQ:JOSB)’s, but Men’s Wearhouse could easily trade at a premium given its better performance and strong dividend.

The article This Stock Is Dressing Up originally appeared on Fool.com and is written by Marshall Hargrave.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.