Mondelez International (NASDAQ:MDLZ) and Tyson Foods (NYSE:TSN) are both large-cap consumer staples companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, profitability, earnings, risk and valuation.
Profitability
This table compares Mondelez International and Tyson Foods' net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Mondelez International | 14.24% | 13.73% | 5.70% |
| Tyson Foods | 4.52% | 13.01% | 5.57% |
Analyst Recommendations
This is a breakdown of current ratings and recommmendations for Mondelez International and Tyson Foods, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Mondelez International | 0 | 2 | 14 | 0 | 2.88 |
| Tyson Foods | 1 | 5 | 7 | 0 | 2.46 |
Mondelez International presently has a consensus price target of $61.1875, suggesting a potential upside of 18.83%. Tyson Foods has a consensus price target of $77.8333, suggesting a potential upside of 33.16%. Given Tyson Foods' higher possible upside, analysts plainly believe Tyson Foods is more favorable than Mondelez International.
Insider and Institutional Ownership
75.5% of Mondelez International shares are owned by institutional investors. Comparatively, 66.2% of Tyson Foods shares are owned by institutional investors. 1.3% of Mondelez International shares are owned by insiders. Comparatively, 1.7% of Tyson Foods shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Volatility & Risk
Mondelez International has a beta of 0.61, indicating that its share price is 39% less volatile than the S&P 500. Comparatively, Tyson Foods has a beta of 0.65, indicating that its share price is 35% less volatile than the S&P 500.
Earnings & Valuation
This table compares Mondelez International and Tyson Foods' revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Mondelez International | $25.87 billion | 2.85 | $3.87 billion | $2.47 | 20.85 |
| Tyson Foods | $42.41 billion | 0.50 | $2.02 billion | $5.46 | 10.71 |
Mondelez International has higher earnings, but lower revenue than Tyson Foods. Tyson Foods is trading at a lower price-to-earnings ratio than Mondelez International, indicating that it is currently the more affordable of the two stocks.
Dividends
Mondelez International pays an annual dividend of $1.14 per share and has a dividend yield of 2.2%. Tyson Foods pays an annual dividend of $1.68 per share and has a dividend yield of 2.9%. Mondelez International pays out 46.2% of its earnings in the form of a dividend. Tyson Foods pays out 30.8% 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. Mondelez International has increased its dividend for 6 consecutive years and Tyson Foods has increased its dividend for 8 consecutive years. Tyson Foods is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Summary
Mondelez International beats Tyson Foods on 9 of the 17 factors compared between the two stocks.
