McCormick & Company, Incorporated (NYSE:MKC) and J & J Snack Foods (NASDAQ:JJSF) are both consumer staples companies, but which is the superior stock? We will compare the two businesses based on the strength of their valuation, institutional ownership, profitability, analyst recommendations, earnings, dividends and risk.
Institutional & Insider Ownership
37.5% of McCormick & Company, Incorporated shares are held by institutional investors. Comparatively, 73.2% of J & J Snack Foods shares are held by institutional investors. 11.0% of McCormick & Company, Incorporated shares are held by company insiders. Comparatively, 21.0% of J & J Snack Foods shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
Volatility and Risk
McCormick & Company, Incorporated has a beta of 0.44, meaning that its stock price is 56% less volatile than the S&P 500. Comparatively, J & J Snack Foods has a beta of 0.58, meaning that its stock price is 42% less volatile than the S&P 500.
Analyst Recommendations
This is a summary of current ratings and price targets for McCormick & Company, Incorporated and J & J Snack Foods, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
---|
McCormick & Company, Incorporated | 2 | 4 | 3 | 0 | 2.11 |
J & J Snack Foods | 0 | 1 | 1 | 0 | 2.50 |
McCormick & Company, Incorporated presently has a consensus target price of $81.5556, indicating a potential downside of 3.40%. J & J Snack Foods has a consensus target price of $138.50, indicating a potential downside of 13.35%. Given McCormick & Company, Incorporated's higher probable upside, equities research analysts plainly believe McCormick & Company, Incorporated is more favorable than J & J Snack Foods.
Profitability
This table compares McCormick & Company, Incorporated and J & J Snack Foods' net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
---|
McCormick & Company, Incorporated | 13.75% | 20.93% | 7.24% |
J & J Snack Foods | 1.79% | 2.84% | 2.18% |
Dividends
McCormick & Company, Incorporated pays an annual dividend of $1.36 per share and has a dividend yield of 1.6%. J & J Snack Foods pays an annual dividend of $2.30 per share and has a dividend yield of 1.4%. McCormick & Company, Incorporated pays out 50.9% of its earnings in the form of a dividend. J & J Snack Foods pays out 207.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. J & J Snack Foods has raised its dividend for 1 consecutive years. McCormick & Company, Incorporated is clearly the better dividend stock, given its higher yield and lower payout ratio.
Valuation and Earnings
This table compares McCormick & Company, Incorporated and J & J Snack Foods' revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
---|
McCormick & Company, Incorporated | $5.35 billion | 4.21 | $702.70 million | $2.67 | 31.62 |
J & J Snack Foods | $1.02 billion | 2.97 | $18.31 million | $1.11 | 144.00 |
McCormick & Company, Incorporated has higher revenue and earnings than J & J Snack Foods. McCormick & Company, Incorporated is trading at a lower price-to-earnings ratio than J & J Snack Foods, indicating that it is currently the more affordable of the two stocks.
Summary
McCormick & Company, Incorporated beats J & J Snack Foods on 11 of the 17 factors compared between the two stocks.