Limoneira (NASDAQ:LMNR) and Alico (NASDAQ:ALCO) are both small-cap consumer staples companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, valuation, earnings, profitability, dividends, analyst recommendations and institutional ownership.
Profitability
This table compares Limoneira and Alico's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
---|
Limoneira | -9.99% | -5.77% | -2.99% |
Alico | 25.58% | -0.87% | -0.41% |
Institutional and Insider Ownership
52.9% of Limoneira shares are owned by institutional investors. Comparatively, 46.8% of Alico shares are owned by institutional investors. 4.5% of Limoneira shares are owned by company insiders. Comparatively, 7.7% of Alico shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Earnings and Valuation
This table compares Limoneira and Alico's gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
---|
Limoneira | $164.56 million | 1.89 | $-5,940,000.00 | ($0.69) | -25.46 |
Alico | $92.51 million | 2.38 | $23.66 million | ($0.24) | -122.17 |
Alico has lower revenue, but higher earnings than Limoneira. Alico is trading at a lower price-to-earnings ratio than Limoneira, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Limoneira has a beta of 1.04, meaning that its share price is 4% more volatile than the S&P 500. Comparatively, Alico has a beta of 0.68, meaning that its share price is 32% less volatile than the S&P 500.
Dividends
Limoneira pays an annual dividend of $0.30 per share and has a dividend yield of 1.7%. Alico pays an annual dividend of $0.72 per share and has a dividend yield of 2.5%. Limoneira pays out -43.5% of its earnings in the form of a dividend. Alico pays out -300.0% 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. Limoneira has raised its dividend for 1 consecutive years and Alico has raised its dividend for 1 consecutive years. Alico is clearly the better dividend stock, given its higher yield and lower payout ratio.
Analyst Recommendations
This is a summary of current recommendations and price targets for Limoneira and Alico, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
---|
Limoneira | 0 | 1 | 6 | 0 | 2.86 |
Alico | 0 | 0 | 1 | 0 | 3.00 |
Limoneira currently has a consensus price target of $23.25, indicating a potential upside of 32.33%. Alico has a consensus price target of $40.00, indicating a potential upside of 36.43%. Given Alico's stronger consensus rating and higher possible upside, analysts plainly believe Alico is more favorable than Limoneira.
Summary
Alico beats Limoneira on 12 of the 16 factors compared between the two stocks.