SYSCO (NYSE: SYY) and SuperValu (NYSE:SVU) are both non-cyclical consumer goods & services companies, but which is the superior investment? We will contrast the two companies based on the strength of their analyst recommendations, risk, valuation, earnings, profitabiliy, institutional ownership and dividends.
Risk & Volatility
SYSCO has a beta of 0.52, indicating that its stock price is 48% less volatile than the S&P 500. Comparatively, SuperValu has a beta of 2.06, indicating that its stock price is 106% more volatile than the S&P 500.
SYSCO pays an annual dividend of $1.32 per share and has a dividend yield of 2.6%. SuperValu does not pay a dividend. SYSCO pays out 69.5% of its earnings in the form of a dividend. SYSCO has increased its dividend for 46 consecutive years.
This table compares SYSCO and SuperValu’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a breakdown of recent ratings and recommmendations for SYSCO and SuperValu, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
SYSCO currently has a consensus target price of $56.42, indicating a potential upside of 9.93%. SuperValu has a consensus target price of $32.90, indicating a potential upside of 43.17%. Given SuperValu’s higher possible upside, analysts plainly believe SuperValu is more favorable than SYSCO.
Valuation and Earnings
This table compares SYSCO and SuperValu’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|SYSCO||$54.60 billion||0.50||$3.00 billion||$1.90||27.01|
|SuperValu||$12.72 billion||N/A||$461.00 million||$16.03||1.43|
SYSCO has higher revenue and earnings than SuperValu. SuperValu is trading at a lower price-to-earnings ratio than SYSCO, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
78.4% of SYSCO shares are held by institutional investors. Comparatively, 80.5% of SuperValu shares are held by institutional investors. 8.8% of SYSCO shares are held by company insiders. Comparatively, 1.7% of SuperValu shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
SYSCO beats SuperValu on 9 of the 16 factors compared between the two stocks.
SYSCO Company Profile
Sysco Corporation (Sysco) is a distributor of food and related products primarily to the foodservice or food-away-from-home industry. The Company’s segments include Broadline, SYGMA and Other. The Broadline segment includes its Broadline operations located in the Bahamas, Canada, Costa Rica, Ireland, Mexico and the United States. Broadline operating companies distribute a full line of food products and a range of non-food products to both traditional and chain restaurant customers, hospitals, schools, hotels, industrial caterers and other venues where foodservice products are served. SYGMA operating companies distribute a full line of food products and a range of non-food products to certain chain restaurant customer locations. The Other segment includes the Company’s specialty produce; custom-cut meat operations; lodging industry segments; a company that distributes specialty imported products; a company that distributes to international customers, and Sysco Ventures platform.
SuperValu Company Profile
Supervalu Inc. is a wholesale distributor to independent retail customers across the United States. The Company’s segments include Wholesale and Retail. The Company offers a range of advertised brand name and private-label products, including grocery (both perishable and nonperishable), general merchandise and home, health and beauty care, and pharmacy, which are sold through Company-operated and licensed Retail stores to shoppers and through its Wholesale segment to independent retail customers. The Company’s Wholesale segment provides wholesale distribution of products to independent retail customers. Wholesale is organized and operated through two geographic regions: East and West. As of February 27, 2016, the Company conducted its Retail operations through a total of 200 stores primarily organized under five regionally-based retail banners of Cub Foods, Shoppers Food & Pharmacy, Shop ‘n Save, Farm Fresh and Hornbacher’s, as well as two Rainbow and two County Market stores.
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