Critical Review: Wal-Mart de Mexico SAB de CV (OTCMKTS:WMMVY) and Chefs’ Warehouse (NASDAQ:CHEF)

Chefs’ Warehouse (NASDAQ:CHEF) and Wal-Mart de Mexico SAB de CV (OTCMKTS:WMMVY) are both consumer staples companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, earnings, risk, profitability, valuation and dividends.

Valuation and Earnings

This table compares Chefs’ Warehouse and Wal-Mart de Mexico SAB de CV”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Chefs’ Warehouse	$4.39 billion	1.03	$72.36 million	$2.10	52.80
Wal-Mart de Mexico SAB de CV	$52.76 billion	0.89	$2.60 billion	$1.60	16.91

Wal-Mart de Mexico SAB de CV has higher revenue and earnings than Chefs’ Warehouse. Wal-Mart de Mexico SAB de CV is trading at a lower price-to-earnings ratio than Chefs’ Warehouse, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Chefs’ Warehouse and Wal-Mart de Mexico SAB de CV’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Chefs’ Warehouse	2.09%	16.95%	5.19%
Wal-Mart de Mexico SAB de CV	4.90%	21.23%	10.12%

Volatility and Risk

Chefs’ Warehouse has a beta of 1.44, suggesting that its share price is 44% more volatile than the S&P 500. Comparatively, Wal-Mart de Mexico SAB de CV has a beta of 0.63, suggesting that its share price is 37% less volatile than the S&P 500.

Institutional and Insider Ownership

91.6% of Chefs’ Warehouse shares are held by institutional investors. 11.1% of Chefs’ Warehouse shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of recent recommendations and price targets for Chefs’ Warehouse and Wal-Mart de Mexico SAB de CV, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Chefs’ Warehouse	0	2	5	0	2.71
Wal-Mart de Mexico SAB de CV	2	2	0	0	1.50

Chefs’ Warehouse presently has a consensus target price of $118.33, suggesting a potential upside of 6.72%. Wal-Mart de Mexico SAB de CV has a consensus target price of $42.00, suggesting a potential upside of 55.21%. Given Wal-Mart de Mexico SAB de CV’s higher possible upside, analysts plainly believe Wal-Mart de Mexico SAB de CV is more favorable than Chefs’ Warehouse.

Summary

Chefs’ Warehouse beats Wal-Mart de Mexico SAB de CV on 8 of the 14 factors compared between the two stocks.

About Chefs’ Warehouse

The Chefs’ Warehouse, Inc., together with its subsidiaries, distributes specialty food and center-of-the-plate products in the United States, the Middle East, and Canada. The company’s product portfolio includes specialty food products, such as artisan charcuterie, specialty cheeses, unique oils and vinegars, truffles, caviar, chocolate, and pastry products; and center-of-the-plate products consisting of custom cut beef, seafood, and hormone-free poultry, as well as broadline food products comprising cooking oils, butter, eggs, milk, and flour. The company serves menu-driven independent restaurants, fine dining establishments, country clubs, hotels, caterers, culinary schools, bakeries, patisseries, chocolatiers, cruise lines, casinos, and specialty food stores. It markets its center-of-the-plate products directly to consumers through a mail and e-commerce platform. The Chefs’ Warehouse, Inc. was founded in 1985 and is headquartered in Ridgefield, Connecticut.

About Wal-Mart de Mexico SAB de CV

Wal-Mart de México, S.A.B. de C.V. owns and operates self-service stores in Mexico and Central America. The company operates discount warehouses and stores, hypermarkets, supermarkets, and membership self-service wholesale stores. It operates Bodega Aurrerá discount stores, Walmart hypermarkets, Walmart Express supermarkets, and Sam’s Club membership self-service wholesale stores. The company operates Despensa Familiar and Palí discount stores; Paiz, La Despensa de Don Juan, La Unión, and Más x Menos supermarkets; Bodegas, Maxi Bodega, and Maxi Palí stores; and Walmart hypermarkets in Costa Rica, Guatemala, Honduras, Nicaragua, and El Salvador. In addition, it imports and sells goods; develops properties; and manages real estate companies. The company was founded in 1958 and is headquartered in Mexico City, Mexico. Wal-Mart de México, S.A.B. de C.V. operates as a subsidiary of Intersalt, S. De R.l. De C.v.