Comparing United Natural Foods (NYSE:UNFI) and Darling Ingredients (NYSE:DAR)

United Natural Foods (NYSE:UNFI) and Darling Ingredients (NYSE:DAR) are both mid-cap consumer staples companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, profitability, valuation, analyst recommendations, dividends, earnings and institutional ownership.

Profitability

This table compares United Natural Foods and Darling Ingredients’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
United Natural Foods	-0.32%	4.35%	0.90%
Darling Ingredients	1.84%	2.39%	1.08%

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for United Natural Foods and Darling Ingredients, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
United Natural Foods	1	6	3	1	2.36
Darling Ingredients	1	2	7	1	2.73

United Natural Foods presently has a consensus target price of $38.78, suggesting a potential upside of 4.05%. Darling Ingredients has a consensus target price of $45.63, suggesting a potential downside of 0.06%. Given United Natural Foods’ higher possible upside, analysts plainly believe United Natural Foods is more favorable than Darling Ingredients.

Risk & Volatility

United Natural Foods has a beta of 0.86, indicating that its stock price is 14% less volatile than the S&P 500. Comparatively, Darling Ingredients has a beta of 1.25, indicating that its stock price is 25% more volatile than the S&P 500.

Earnings & Valuation

This table compares United Natural Foods and Darling Ingredients”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
United Natural Foods	$31.78 billion	0.07	-$118.00 million	($1.66)	-22.45
Darling Ingredients	$5.72 billion	1.26	$278.88 million	$0.67	68.14

Darling Ingredients has lower revenue, but higher earnings than United Natural Foods. United Natural Foods is trading at a lower price-to-earnings ratio than Darling Ingredients, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

87.6% of United Natural Foods shares are owned by institutional investors. Comparatively, 94.4% of Darling Ingredients shares are owned by institutional investors. 2.4% of United Natural Foods shares are owned by company insiders. Comparatively, 2.6% of Darling Ingredients shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Summary

Darling Ingredients beats United Natural Foods on 11 of the 14 factors compared between the two stocks.

About United Natural Foods

United Natural Foods, Inc., together with its subsidiaries, distributes natural, organic, specialty, produce, and conventional grocery and non-food products in the United States and Canada. It operates in two segments, Wholesale and Retail. The company offers grocery and general merchandise, produce, perishables and frozen foods, wellness and personal care items, and bulk and foodservice products. It also provides nuts, dried fruit, seeds, trail mixes, granola, natural and organic snack items, and confections under the Woodstock Farms Manufacturing name; organic, non-GMO project verified, and specialty food and non-food items under the Blue Marble brand name; pet food under the WILD HARVEST brand name; and various products under the ESSENTIAL EVERYDAY, SHOPPERS VALUE, Field Day, EQUALINE, CULINARY CIRCLE, and STONE RIDGE CREAMERY brand names. In addition, the company provides home, health and beauty care, and pharmacy products, as well as private label products through a network of Cub Foods and Shoppers retail grocery stores; and retail store support, pricing strategy, shelf and planogram management, advertising, couponing, ecommerce, consumer convenience, store design, equipment sourcing, electronic payments processing, network and data hosting, point-of-sale hardware and software, automation tools, sustainability, and administrative back-office solution services. Further, it offers consumer and trade marketing programs, and programs to support suppliers in understanding its markets. The company serves chains, independent retailers, and supernatural chains, as well as foodservice, ecommerce, conventional military business, and other sales customers. United Natural Foods, Inc. was founded in 1976 and is headquartered in Providence, Rhode Island.

About Darling Ingredients

Darling Ingredients Inc. develops, produces, and sells natural ingredients from edible and inedible bio-nutrients in North America, Europe, China, South America, and internationally. The company operates through three segments: Feed Ingredients, Food Ingredients, and Fuel Ingredients. It offers ingredients and customized specialty solutions for customers in the pharmaceutical, food, pet food, feed, industrial, fuel, bioenergy, and fertilizer industries. The company also collects and transforms various animal by-product streams into useable and specialty ingredients, such as collagen, edible fats, feed-grade fats, animal proteins and meals, plasma, pet food ingredients, organic fertilizers, yellow grease, fuel feedstock, green energy, natural casings, and hides. In addition, it recovers and converts used cooking oil and animal fats, and residual bakery products into valuable feed and fuel ingredients. Further, the company provides environmental services, including grease trap collection and disposal services to food service establishments. It primarily operates under the Rendac, Sonac, FASA, Ecoson, Rousselot, Gelnex, and CTH brand names. The company was formerly known as Darling International Inc. and changed its name to Darling Ingredients Inc. in May 2014. Darling Ingredients Inc. was founded in 1882 and is headquartered in Irving, Texas.