McCormick & Company, Incorporated (NYSE:MKC) and B&G Foods (NYSE:BGS) are both consumer staples companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, dividends, earnings, analyst recommendations, profitability, institutional ownership and risk.
Valuation & Earnings
This table compares McCormick & Company, Incorporated and B&G Foods' gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
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McCormick & Company, Incorporated | $5.35 billion | 4.21 | $702.70 million | $2.67 | 31.62 |
B&G Foods | $1.66 billion | 1.16 | $76.39 million | $1.64 | 18.34 |
McCormick & Company, Incorporated has higher revenue and earnings than B&G Foods. B&G Foods is trading at a lower price-to-earnings ratio than McCormick & Company, Incorporated, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares McCormick & Company, Incorporated and B&G 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% |
B&G Foods | 6.75% | 17.25% | 4.31% |
Dividends
McCormick & Company, Incorporated pays an annual dividend of $1.36 per share and has a dividend yield of 1.6%. B&G Foods pays an annual dividend of $1.90 per share and has a dividend yield of 6.3%. McCormick & Company, Incorporated pays out 50.9% of its earnings in the form of a dividend. B&G Foods pays out 115.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. B&G Foods has raised its dividend for 1 consecutive years. B&G Foods is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Institutional & Insider Ownership
37.5% of McCormick & Company, Incorporated shares are owned by institutional investors. Comparatively, 72.9% of B&G Foods shares are owned by institutional investors. 11.0% of McCormick & Company, Incorporated shares are owned by insiders. Comparatively, 1.9% of B&G Foods shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Analyst Ratings
This is a breakdown of recent ratings and target prices for McCormick & Company, Incorporated and B&G Foods, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
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McCormick & Company, Incorporated | 2 | 4 | 3 | 0 | 2.11 |
B&G Foods | 1 | 6 | 1 | 0 | 2.00 |
McCormick & Company, Incorporated currently has a consensus price target of $81.5556, suggesting a potential downside of 3.40%. B&G Foods has a consensus price target of $26.40, suggesting a potential downside of 12.20%. Given McCormick & Company, Incorporated's stronger consensus rating and higher probable upside, analysts clearly believe McCormick & Company, Incorporated is more favorable than B&G Foods.
Volatility and Risk
McCormick & Company, Incorporated has a beta of 0.44, suggesting that its stock price is 56% less volatile than the S&P 500. Comparatively, B&G Foods has a beta of 0.5, suggesting that its stock price is 50% less volatile than the S&P 500.
Summary
McCormick & Company, Incorporated beats B&G Foods on 13 of the 17 factors compared between the two stocks.