Do Apparel Stores Have a Higher Return on Equity (ROE) than Department Stores?

Do Apparel Stores Have a Higher Return on Equity (ROE) than Department Stores?

 

 

My population is the return on equity in all years for all apparel stores and return on equity in all years for all department stores.  The parameters are the mean return on equity for all apparel stores and the mean return on equity for all department stores.  The samples are 51 apparel stores and 30 department stores from Yahoo Finance on November 6, 2013.  I eliminated stores for which Yahoo did not have a ROE or that had negative ROE.  The statistics are the mean return on equity for 51 apparel stores which was 19.30and the mean return on equity for 30 department stores which was 16.47%.

 

Presentation of the data:

 

Department Store ROE %           cumulative
  lower   upper midpoint width  frequency percent     frequency percent
0.00 < 5.00 2.50 5.00 5 16.7 5 16.7
5.00 < 10.00 7.50 5.00 4 13.3 9 30.0
10.00 < 15.00 12.50 5.00 7 23.3 16 53.3
15.00 < 20.00 17.50 5.00 7 23.3 23 76.7
20.00 < 25.00 22.50 5.00 3 10.0 26 86.7
25.00 < 30.00 27.50 5.00 1 3.3 27 90.0
30.00 < 35.00 32.50 5.00 0 0.0 27 90.0
35.00 < 40.00 37.50 5.00 0 0.0 27 90.0
40.00 < 45.00 42.50 5.00 1 3.3 28 93.3
45.00 < 50.00 47.50 5.00 1 3.3 29 96.7
50.00 < 55.00 52.50 5.00 0 0.0 29 96.7
55.00 < 60.00 57.50 5.00 1 3.3 30 100.0
30 100.0

 

 

     
Department Store
  ROE %
count 30
mean 16.41727
sample standard deviation 12.64181
sample variance 159.81544
minimum 0.599
maximum 55.215
range 54.616

 

Apparel stores ROE %           cumulative
  lower   upper midpoint width  frequency percent     frequency percent
0.00 < 10.00 5.00 10.00 12 23.5 12 23.5
10.00 < 20.00 15.00 10.00 22 43.1 34 66.7
20.00 < 30.00 25.00 10.00 8 15.7 42 82.4
30.00 < 40.00 35.00 10.00 3 5.9 45 88.2
40.00 < 50.00 45.00 10.00 4 7.8 49 96.1
50.00 < 60.00 55.00 10.00 1 2.0 50 98.0
60.00 < 70.00 65.00 10.00 0 0.0 50 98.0
70.00 < 80.00 75.00 10.00 1 2.0 51 100.0
51 100.0

 

 

Apparel stores
  ROE %
count 51
mean 19.29759
sample standard deviation 14.90353
sample variance 222.11522
minimum 1.057
maximum 71.474
range 70.417

 

 

Hypothesis test:

Ho:  µAp  ≥ µDept   or  µAp – µDept  ≥  0

HA:  µAp  < µDept or µAp – µDept  <  0

Tcrit   = 2.462 ( using α = 0.01 in one tail and df = n – 1 = 30 – 1 =29 using the smaller of the sample sizes) In Excel, t.inv(.99,29)

Fail to reject Ho.  The 2.88% difference between the mean return on equity for apparel companies and the mean return on equity of department stores is not sufficient evidence to prove that the apparel companies have a significantly higher return on equity than department stores, on average.  There was quite a bit of variation within the two data sets which resulted in me not being confident in the difference I found between the two means.  Note that both had distributions that are skewed to the right, but since the sample sizes both exceed 30, I was able to use the normal distribution in the analysis.

 

 

Appendix:  Data table:

Department Stores Apparel Stores
ROE % ROE %
Kirkcaldie & Stains Limited 0.599 Ocean Sky International Ltd. 1.057
Bon-Ton Stores Inc. 0.616 Destination XL Group, Inc. 1.273
Grupo Elektra, S.A. de C.V. 1.769 Reitmans (Canada) Limited 1.437
Saks Incorporated 3.768 Reitmans (Canada) Limited 1.437
Metro Holdings Limited 4.656 LeRoi Holdings Ltd. 2.658
Sears Hometown and Outlet Stor 7.496 Etam Developpement SA 4.509
Grupo Famsa SAB de CV 7.931 New York & Company Inc. 5.409
Lianhua Supermarket 8.176 Stage Stores Inc. 6.578
Organizacion Soriana 8.846 Moss Bros Group PLC 6.944
New World Depa.Store Chin 10.184 The Children 8.954
Sears Canada Inc. 11.801 Joyce Boutique Holdings Ltd. 9.081
Parkson Retail Group Ltd. 11.987 Jos. A Bank Clothiers Inc. 9.744
David Jones Limited 12.073 Shoe Carnival Inc. 10.13
Wing On Company Inter 14.091 Evergreen International 10.507
Century Ginwa Retail 14.306 Ascena Retail Group Inc. 10.713
Intime Department Store Group 14.585 Stein Mart Inc. 11.616
Springland International 15.368 The Men’s Wearhouse, Inc. 11.701
Kohl’s Corp. 15.848 I.T Ltd. 12.178
Services 16.887 Trinity Ltd. 12.875
Marks & Spencer Group PLC 17.397 Genesco Inc. 13.012
Dillard’s Inc. 18.037 Premier Investments Limited 13.683
Debenhams PLC 18.201 Abercrombie & Fitch Co. 14.525
Patagonia 19.034 The Cato Corporation 14.8
Macy’s, Inc. 23.354 Luxottica Group S.p.A. 14.812
Lifestyle International 23.667 Luxottica Group SpA 14.812
Ashley (Laura) Holdings PLC 24.18 Goldlion Holdings Ltd. 15.036
Golden Eagle Retail Group Ltd. 25.666 Guess’ Inc. 15.107
Warehouse Group Limited (The) 41.039 Kathmandu Holdings Limited 15.396
China Seven Star Shopping Ltd. 45.741 Chico’s FAS Inc. 15.435
The TJX Companies, Inc. 55.215 DSW Inc. 15.884
Xtep International 15.929
American Eagle Outfitters, Inc 16.762
OrotonGroup Limited 17.265
Urban Outfitters Inc. 19.715
Specialty Fashion 21.308
Destination Maternity Corporat 21.362
Marisa Lojas SA 22.836
Casual Male Retail Group, Inc. 25.52
ANN INC. 25.902
Tilly’s, Inc. 25.966
Hallenstein Glasson Limited 27.969
Giordano International Ltd. 29.615
Industria De Diseno Textil SA 30.974
Express Inc. 36.534
Nordstrom Inc. 39.255
The Gap, Inc. 40.749
The Buckle, Inc. 44.135
Ross Stores Inc. 46.945
Cherokee Inc. 47.444
TJX Companies 55.215
Francesca’s Holdings Corporati 71.474
Type of paper Academic level Subject area
Number of pages Paper urgency Cost per page:
 Total: