Contrasting Vital Farms (NASDAQ:VITL) & Flowers Foods (NYSE:FLO)

Flowers Foods (NYSE:FLO) and Vital Farms (NASDAQ:VITL) are both small-cap consumer staples companies, but which is the superior investment? We will compare the two companies based on the strength of their risk, valuation, earnings, profitability, analyst recommendations, dividends and institutional ownership.

Profitability

This table compares Flowers Foods and Vital Farms’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Flowers Foods	1.06%	14.91%	4.72%
Vital Farms	0.02%	3.46%	2.25%

Risk and Volatility

Flowers Foods has a beta of 0.43, indicating that its share price is 57% less volatile than the S&P 500. Comparatively, Vital Farms has a beta of 1.08, indicating that its share price is 8% more volatile than the S&P 500.

Insider and Institutional Ownership

75.4% of Flowers Foods shares are held by institutional investors. Comparatively, 98.6% of Vital Farms shares are held by institutional investors. 7.2% of Flowers Foods shares are held by insiders. Comparatively, 3.9% of Vital Farms shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Earnings & Valuation

This table compares Flowers Foods and Vital Farms”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Flowers Foods	$5.22 billion	0.25	$83.82 million	$0.26	24.12
Vital Farms	$759.44 million	0.49	$66.28 million	($0.04)	-216.75

Flowers Foods has higher revenue and earnings than Vital Farms. Vital Farms is trading at a lower price-to-earnings ratio than Flowers Foods, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Flowers Foods and Vital Farms, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Flowers Foods	3	4	0	0	1.57
Vital Farms	1	8	5	0	2.29

Flowers Foods presently has a consensus target price of $6.80, indicating a potential upside of 8.45%. Vital Farms has a consensus target price of $16.36, indicating a potential upside of 88.74%. Given Vital Farms’ stronger consensus rating and higher possible upside, analysts clearly believe Vital Farms is more favorable than Flowers Foods.

Summary

Flowers Foods beats Vital Farms on 8 of the 14 factors compared between the two stocks.

About Flowers Foods

Flowers Foods, Inc. produces and markets packaged bakery food products in the United States. Its principal products include fresh breads, buns, rolls, snack items, bagels, English muffins, and tortillas, as well as frozen breads and rolls under the Nature's Own, Dave's Killer Bread, Wonder, Canyon Bakehouse, Mrs. Freshley's, and Tastykake brand names. The company distributes its products through a direct-store-delivery distribution and a warehouse delivery system, as well as operates bakeries. Its customers include national and regional restaurants, institutions and foodservice distributors, and retail in-store bakeries; wholesale distributors; mass merchandisers, supermarkets, vending outlets, and convenience stores; quick-serve chains, food wholesalers, institutions, dollar stores, and vending companies; and public health care, military commissaries, and prisons, and other governmental institutions. The company was formerly known as Flowers Industries and changed its name to Flowers Foods, Inc. in 2001. Flowers Foods, Inc. was founded in 1919 and is headquartered in Thomasville, Georgia.

About Vital Farms

Vital Farms, Inc., a food company, provides pasture-raised products in the United States. It offers shell eggs, butter, hard-boiled eggs, and liquid whole eggs. The company was founded in 2007 and is headquartered in Austin, Texas.