Analyzing Fresh Del Monte Produce (NYSE:FDP) & FMC (NYSE:FMC)

Fresh Del Monte Produce (NYSE:FDP) and FMC (NYSE:FMC) are both small-cap consumer staples companies, but which is the better business? We will compare the two businesses based on the strength of their profitability, earnings, risk, valuation, institutional ownership, dividends and analyst recommendations.

Earnings & Valuation

This table compares Fresh Del Monte Produce and FMC”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Fresh Del Monte Produce	$4.32 billion	0.40	$142.20 million	$1.63	22.18
FMC	$3.61 billion	0.46	$341.10 million	($4.24)	-3.17

FMC has lower revenue, but higher earnings than Fresh Del Monte Produce. FMC is trading at a lower price-to-earnings ratio than Fresh Del Monte Produce, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Fresh Del Monte Produce and FMC’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Fresh Del Monte Produce	1.84%	6.63%	4.32%
FMC	2.42%	9.36%	3.51%

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Fresh Del Monte Produce and FMC, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Fresh Del Monte Produce	0	0	1	0	3.00
FMC	1	10	3	0	2.14

FMC has a consensus target price of $29.75, indicating a potential upside of 121.60%. Given FMC’s higher possible upside, analysts plainly believe FMC is more favorable than Fresh Del Monte Produce.

Insider & Institutional Ownership

64.8% of Fresh Del Monte Produce shares are owned by institutional investors. Comparatively, 91.9% of FMC shares are owned by institutional investors. 31.6% of Fresh Del Monte Produce shares are owned by insiders. Comparatively, 0.7% of FMC shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Volatility and Risk

Fresh Del Monte Produce has a beta of 0.41, indicating that its share price is 59% less volatile than the S&P 500. Comparatively, FMC has a beta of 0.76, indicating that its share price is 24% less volatile than the S&P 500.

Dividends

Fresh Del Monte Produce pays an annual dividend of $1.20 per share and has a dividend yield of 3.3%. FMC pays an annual dividend of $2.32 per share and has a dividend yield of 17.3%. Fresh Del Monte Produce pays out 73.6% of its earnings in the form of a dividend. FMC pays out -54.7% 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. Fresh Del Monte Produce has raised its dividend for 5 consecutive years. FMC is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

FMC beats Fresh Del Monte Produce on 10 of the 17 factors compared between the two stocks.

About Fresh Del Monte Produce

Fresh Del Monte Produce Inc., through its subsidiaries, produces, markets, and distributes fresh and fresh-cut fruits and vegetables in North America, Central America, South America, Europe, the Middle East, Africa, Asia, and internationally. It operates through three segments: Fresh and Value-Added Products, Banana, and Other Products and Services. The company offers pineapples, fresh-cut fruit, fresh-cut vegetables, melons, and vegetables; non-tropical fruits, such as grapes, apples, citrus, blueberries, strawberries, pears, peaches, plums, nectarines, cherries, and kiwis; other fruit and vegetables, and avocados; and prepared fruit and vegetables, juices, other beverages, and meals and snacks. It also engages in the sale of poultry and meat products; and third-party freight services business. The company offers its products under the Del Monte brand, as well as under other brands, such as UTC, Rosy, Just Juice, Fruitini, Pinkglow, Del Monte Zero, Honeyglow, Rubyglow, Honey Miniglow, Bananinis, Mann, Mann’s Logo, Arcadian Harvest, Nourish Bowls, Broccolini, Caulilini, Better Burger Leaf, Romaleaf, and other regional brands. It markets and distributes its products to retail stores, club stores, convenience stores, wholesalers, distributors, and foodservice operators. Fresh Del Monte Produce Inc. was founded in 1886 and is based in George Town, Cayman Islands.

About FMC

FMC Corporation, an agricultural sciences company, provides crop protection, plant health, and professional pest and turf management products. It develops, markets, and sells crop protection chemicals that includes insecticides, herbicides, and fungicides; and biologicals, crop nutrition, and seed treatment products, which are used in agriculture to enhance crop yield and quality by controlling a range of insects, weeds, and diseases, as well as in non-agricultural markets for pest control. The company markets its products through its own sales organization and through alliance partners, independent distributors, and sales representatives. It operates in North America, Latin America, Europe, the Middle East, Africa, and Asia. The company was founded in 1883 and is headquartered in Philadelphia, Pennsylvania.