Head to Head Analysis: Castle Brands (ROX) & Diageo PLC (DEO)

Diageo PLC (NYSE: DEO) and Castle Brands (NYSE:ROX) are both consumer staples companies, but which is the superior business? We will contrast the two companies based on the strength of their profitability, dividends, analyst recommendations, earnings, risk, valuation and institutional ownership.

Insider and Institutional Ownership

12.1% of Diageo PLC shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Dividends

Diageo PLC pays an annual dividend of $3.20 per share and has a dividend yield of 2.4%. Castle Brands does not pay a dividend. Diageo PLC has raised its dividend for 5 consecutive years.

Analyst Recommendations

This is a summary of recent recommendations for Diageo PLC and Castle Brands, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Diageo PLC	3	1	6	0	2.30
Castle Brands	0	0	0	0	N/A

Diageo PLC currently has a consensus price target of $147.50, suggesting a potential upside of 11.01%. Given Diageo PLC’s higher probable upside, equities research analysts plainly believe Diageo PLC is more favorable than Castle Brands.

Profitability

This table compares Diageo PLC and Castle Brands’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Diageo PLC	N/A	N/A	N/A
Castle Brands	3.10%	6.81%	5.19%

Valuation & Earnings

This table compares Diageo PLC and Castle Brands’ gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	EBITDA	Earnings Per Share	Price/Earnings Ratio
Diageo PLC	$15.91 billion	5.25	$5.13 billion	N/A	N/A
Castle Brands	$73.80 million	3.49	$3.10 million	N/A	N/A

Diageo PLC has higher revenue and earnings than Castle Brands.

Summary

Diageo PLC beats Castle Brands on 8 of the 11 factors compared between the two stocks.

Diageo PLC Company Profile

Diageo PLC is an alcoholic beverage company. The Company operates in various categories, including spirits and beer. Its geographic segments include North America; Europe, Russia and Turkey; Africa; Latin America and Caribbean, and Asia Pacific. Its principal products includes Scotch whisky, Gin, Vodka, Rum, Beer, Irish Cream Liqueur, Wine, Raki, Tequila, Canadian Whisky, American Whiskey, Progressive Adult Beverages, Cachaca, Brandy and Ready to Drink. The Company’s brands includes Johnnie Walker, Smirnoff, Captain Morgan, Baileys, Tanqueray and Guinness. It manages its operations from various locations, including the United Kingdom; Ireland; Italy; Turkey; the United States; Canada; Brazil; Mexico; Australia; Singapore; India; Nigeria; South Africa; East Africa, and Africa Regional Markets. It also produces a range of ready to drink products mainly in the United Kingdom, Italy, South Africa, Australia, the United States and Canada.

Castle Brands Company Profile

Castle Brands Inc. develops and markets premium and super premium brands in the beverage alcohol categories. The Company is engaged in the sale of premium beverage alcohol. Its beverage alcohol categories include rum, whiskey, liqueurs, vodka and tequila. Its brands include Gosling’s rum, Gosling’s Stormy Ginger Beer, Gosling’s Dark ‘n Stormy ready-to-drink cocktail, Jefferson’s bourbon, Jefferson’s Reserve, Jefferson’s Ocean Aged at Sea, Jefferson’s Wine Finish Collection, Jefferson’s The Manhattan: Barrel Finished Cocktail, Jefferson’s Chef’s Collaboration, Jefferson’s Wood Experiment, Jefferson’s Presidential Select, Jefferson’s Rye whiskey, Pallini liqueurs, Clontarf Irish whiskey, Knappogue Castle Whiskey, Brady’s Irish Cream, Boru vodka, Tierras tequila, Celtic Honey liqueur and Gozio amaretto. It has operations in two geographic areas: International and the United States. The Company distributes its products in all 50 states of the United States and the District of Columbia.