Hormel Foods Corporation (NYSE: HRL) and Smithfield Foods (NYSE:SFD) are both consumer staples companies, but which is the better business? We will compare the two businesses based on the strength of their analyst recommendations, dividends, earnings, risk, valuation, institutional ownership and profitability.
Institutional & Insider Ownership
38.3% of Hormel Foods Corporation shares are owned by institutional investors. 3.5% of Hormel Foods Corporation shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
Valuation & Earnings
This table compares Hormel Foods Corporation and Smithfield Foods’ revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Hormel Foods Corporation||$9.52 billion||1.79||$890.05 million||$1.62||19.96|
Hormel Foods Corporation has higher revenue and earnings than Smithfield Foods. Smithfield Foods is trading at a lower price-to-earnings ratio than Hormel Foods Corporation, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of current ratings and recommmendations for Hormel Foods Corporation and Smithfield Foods, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Hormel Foods Corporation||1||5||4||0||2.30|
Hormel Foods Corporation currently has a consensus price target of $34.63, indicating a potential upside of 7.10%.
This table compares Hormel Foods Corporation and Smithfield Foods’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Hormel Foods Corporation||9.38%||18.90%||13.62%|
Hormel Foods Corporation pays an annual dividend of $0.68 per share and has a dividend yield of 2.1%. Smithfield Foods does not pay a dividend. Hormel Foods Corporation pays out 42.0% of its earnings in the form of a dividend. Smithfield Foods has raised its dividend for 50 consecutive years.
Hormel Foods Corporation beats Smithfield Foods on 9 of the 11 factors compared between the two stocks.
Hormel Foods Corporation Company Profile
Hormel Foods Corporation is engaged in the production of a range of meat and food products. The Company operates through five segments: Grocery Products, which is engaged in the processing, marketing and sale of shelf-stable food products sold for the retail market; Refrigerated Foods, which consists of the processing, marketing and sale of branded and unbranded pork, beef, chicken and turkey products for retail, foodservice and fresh product customers; Jennie-O Turkey Store (JOTS), which consists of the processing, marketing and sale of branded and unbranded turkey products for retail, foodservice and fresh product customers; Specialty Foods, which consists of the packaging and sale of nutritional and private label shelf-stable products to industrial, retail and foodservice customers, and International & Other, which includes Hormel Foods International Corporation, which manufactures, markets and sells the Company products internationally.
Smithfield Foods Company Profile
Smithfield Foods, Inc. produces and markets a variety of fresh meat and packaged meats products both domestically and internationally. The Company operates in four segments: Pork, Hog Production, International and Corporate, each of which consists of a number of subsidiaries, joint ventures and other investments. The Pork segment consists mainly of its three wholly owned United States fresh pork and packaged meats subsidiaries: The Smithfield Packing Company, Inc. (Smithfield Packing), Farmland Foods, Inc. (Farmland Foods) and John Morrell Food Group (John Morrell). The Hog Production segment consists of the Company’s hog production operations located in the United States. On September 2012 (fiscal 2013), the Company acquired a 70% controlling interest in American Skin Food Group, LLC. Effective September 26, 2013, Shuanghui International Holdings Ltd merged with Smithfield Foods Inc, a producer and wholesaler of pork meat products.
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