Nestle (OTCMKTS: NSRGY) and United Natural Foods (NASDAQ:UNFI) are both consumer staples companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, risk, profitability, institutional ownership, analyst recommendations, dividends and earnings.
Institutional & Insider Ownership
1.4% of Nestle shares are owned by institutional investors. 1.4% of United Natural Foods shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
This table compares Nestle and United Natural Foods’ revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Nestle||$91.22 billion||2.63||$7.30 billion||N/A||N/A|
|United Natural Foods||$9.27 billion||0.23||$130.15 million||$3.07||13.53|
Nestle has higher revenue and earnings than United Natural Foods.
This is a breakdown of recent ratings and target prices for Nestle and United Natural Foods, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|United Natural Foods||4||9||5||0||2.06|
United Natural Foods has a consensus target price of $44.67, indicating a potential upside of 7.50%. Given United Natural Foods’ stronger consensus rating and higher probable upside, analysts plainly believe United Natural Foods is more favorable than Nestle.
Volatility and Risk
Nestle has a beta of 0.58, suggesting that its stock price is 42% less volatile than the S&P 500. Comparatively, United Natural Foods has a beta of 1.45, suggesting that its stock price is 45% more volatile than the S&P 500.
Nestle pays an annual dividend of $1.92 per share and has a dividend yield of 2.5%. United Natural Foods does not pay a dividend.
This table compares Nestle and United Natural Foods’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|United Natural Foods||1.61%||8.49%||4.83%|
United Natural Foods beats Nestle on 8 of the 13 factors compared between the two stocks.
Nestle S.A. is a nutrition, health and wellness company. The Company’s segments are Zone Europe, Middle East and North Africa (EMENA); Zone Americas (AMS); Zone Asia, Oceania and sub-Saharan Africa (AOA); Nestle Waters; Nestle Nutrition, and Other Businesses. The Company operates in the United States, Greater China Region, Switzerland and Rest of the World. The Company’s product categories include powered and liquid beverages; water; milk products and ice cream; nutrition and health science; prepared dishes and cooking aids; confectionery, and PetCare. Its other business activities include the operations of Nestle Professional, Nespresso, Nestle Health Science and Nestle Skin Health. It operates in approximately 190 countries throughout the world. It has sales in various countries, including the United States, Greater China Region, Brazil, Mexico, Germany, the United Kingdom, Italy, Canada, France, Turkey, Ukraine, Georgia, Hungary, Malta, Romania, Spain and Switzerland.
About United Natural Foods
United Natural Foods, Inc. is a distributor and retailer of natural, organic and specialty products. The Company’s segments include Wholesale and Other. The Wholesale segment is engaged in the national distribution of natural, organic and specialty foods, produce and related products in the United States and Canada. The Other segment includes a retail division, which engages in the sale of natural foods and related products to the general public through retail storefronts on the east coast of the United States; a manufacturing division, which engages in importing, roasting and packaging of nuts, seeds, dried fruit and snack items, and its branded product lines. Its operations consist of three operating divisions: Wholesale Division, Retail Division, and Manufacturing and Branded Products divisions. As of July 30, 2016, the Company had offered 100,000 natural, organic and specialty foods, and non-food products, consisting of national, regional and private-label brands.
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