Mondelez International (NASDAQ: MDLZ) and Ralcorp (NYSE:RAH) are both non-cyclical consumer goods & services companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, institutional ownership, analyst recommendations, earnings, profitability, valuation and dividends.
Institutional and Insider Ownership
75.8% of Mondelez International shares are held by institutional investors. 3.6% of Mondelez International shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
This is a summary of current ratings and target prices for Mondelez International and Ralcorp, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Mondelez International currently has a consensus target price of $49.58, suggesting a potential upside of 16.75%.
Earnings and Valuation
This table compares Mondelez International and Ralcorp’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Mondelez International||$25.92 billion||2.45||$1.66 billion||$1.44||29.49|
Mondelez International has higher revenue and earnings than Ralcorp. Ralcorp is trading at a lower price-to-earnings ratio than Mondelez International, indicating that it is currently the more affordable of the two stocks.
Mondelez International pays an annual dividend of $0.88 per share and has a dividend yield of 2.1%. Ralcorp does not pay a dividend. Mondelez International pays out 61.1% of its earnings in the form of a dividend.
This table compares Mondelez International and Ralcorp’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Mondelez International beats Ralcorp on 10 of the 11 factors compared between the two stocks.
About Mondelez International
Mondelez International, Inc. is a snack company. The Company manufactures and markets snack food and beverage products for consumers. It operates through four segments: Latin America, Asia, Middle East, and Africa (AMEA), Europe and North America. As of December 31, 2016, its brands spanned five product categories: Biscuits (including cookies, crackers and salted snacks); Chocolate; Gum and candy; Beverages (including coffee and powdered beverages), and Cheese and grocery. Itsportfolio includes various snack brands, including Nabisco, Oreo, LU and belVita biscuits; Cadbury, Milka, Cadbury Dairy Milk and Toblerone chocolate; Trident gum; Halls candy, and Tang powdered beverages. The Company sells its products to supermarket chains, wholesalers, supercenters, club stores, mass merchandisers, distributors, convenience stores, gasoline stations, drug stores, value stores and retail food outlets. As of December 31, 2016, it sold its products to consumers in approximately 165 countries.
Ralcorp Holdings, Inc. (Ralcorp) is engaged in manufacturing, distributing and marketing private-brand food products and other regional and value-brand food products in the grocery, mass merchandise, drugstore and foodservice channels. The Company’s products include nutritional bars; snack mixes, corn-based chips and extruded corn snack products; crackers and cookies; snack nuts; chocolate candy; salad dressings; mayonnaise; peanut butter; jams and jellies; syrups; sauces; frozen griddle products, including pancakes, waffles and French toast; frozen biscuits and other frozen pre-baked products, such as breads and rolls; frozen and refrigerated doughs, and dry pasta. In May 2012, the Company acquired Petri Baking Products, Inc. In June 2012, the Company acquired Gelit S.r.l., a producer of frozen ready meals in Italy. In January 2013, ConAgra Foods Inc acquired the Company.
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