Pinnacle Foods (NYSE: PF) and Mondelez International (NASDAQ:MDLZ) are both consumer staples companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, earnings, valuation, institutional ownership, profitability, risk and analyst recommendations.
Volatility & Risk
Pinnacle Foods has a beta of 0.47, suggesting that its stock price is 53% less volatile than the S&P 500. Comparatively, Mondelez International has a beta of 0.87, suggesting that its stock price is 13% less volatile than the S&P 500.
This table compares Pinnacle Foods and Mondelez International’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Pinnacle Foods||$3.14 billion||2.29||$532.04 million||$2.55||23.75|
|Mondelez International||$25.90 billion||2.28||$2.92 billion||$2.14||18.58|
Mondelez International has higher revenue and earnings than Pinnacle Foods. Mondelez International is trading at a lower price-to-earnings ratio than Pinnacle Foods, indicating that it is currently the more affordable of the two stocks.
This table compares Pinnacle Foods and Mondelez International’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Institutional and Insider Ownership
97.3% of Pinnacle Foods shares are held by institutional investors. Comparatively, 75.7% of Mondelez International shares are held by institutional investors. 1.3% of Pinnacle Foods shares are held by insiders. Comparatively, 2.0% of Mondelez International shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
This is a summary of recent recommendations and price targets for Pinnacle Foods and Mondelez International, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Pinnacle Foods currently has a consensus price target of $64.36, indicating a potential upside of 6.28%. Mondelez International has a consensus price target of $50.67, indicating a potential upside of 27.40%. Given Mondelez International’s higher possible upside, analysts plainly believe Mondelez International is more favorable than Pinnacle Foods.
Pinnacle Foods pays an annual dividend of $1.30 per share and has a dividend yield of 2.1%. Mondelez International pays an annual dividend of $0.88 per share and has a dividend yield of 2.2%. Pinnacle Foods pays out 51.0% of its earnings in the form of a dividend. Mondelez International pays out 41.1% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Pinnacle Foods has increased its dividend for 4 consecutive years. Mondelez International is clearly the better dividend stock, given its higher yield and lower payout ratio.
Mondelez International beats Pinnacle Foods on 10 of the 17 factors compared between the two stocks.
Pinnacle Foods Company Profile
Pinnacle Foods Inc. manufactures, markets, and distributes branded convenience food products in North America. It operates through four segments: Frozen, Grocery, Boulder, and Specialty. The Frozen segment offers frozen vegetables, frozen complete bagged meals, frozen prepared seafood, frozen and refrigerated bagels, frozen pizza, and full-calorie single-serve frozen dinners and entrées under the Birds Eye, Birds Eye Voila!, Van de Kamp's, Mrs. Paul's, Lender's, Celeste, Hungry-Man, and Aunt Jemima brand names. The Grocery segment provides cake/brownie mixes and frostings, cookie mixes, shelf-stable salad dressings, salad dressings, canned meat, table syrups, margarine/spread, pie and pastry fruit fillings, barbecue sauce, and shelf-stable pickles under the Duncan Hines, Vlasic, Wish-Bone, Western, Armour, Brooks, Nalley, Log Cabin, Mrs. Butterworth's, Smart Balance, Comstock, Wilderness, and Open Pit brands. The Boulder segment offers gluten-free products, natural frozen meal offerings, plant-based refrigerated and shelf-stable spreads, and plant-based protein frozen products under the Udi's, Glutino, EVOL, Earth Balance, and gardein brands. The Specialty segment provides snack products under the Hawaiian kettle style chips, Tim's Cascade, Snyder of Berlin, and Husman's brand names; and manufactures and distributes products primarily in the gluten-free, frozen meat substitutes, canned meat, and pie and pastry fruit filling categories, as well as engages in private label businesses. The company sells its products through supermarkets, grocery wholesalers and distributors, mass merchandisers, super centers, convenience stores, dollar stores, natural and organic food stores, drug stores, warehouse clubs, and e-commerce websites in the United States and Canada, as well as in military channels and foodservice locations. Pinnacle Foods Inc. is headquartered in Parsippany, New Jersey.
Mondelez International Company Profile
Mondelez International, Inc., through its subsidiaries, manufactures and markets snack food and beverage products worldwide. It offers biscuits, including cookies, crackers, and salted snacks; chocolates; gums and candies; coffee and powdered beverages; and cheese and grocery products. The company's primary snack brand portfolio includes Nabisco, Oreo, LU, and belVita biscuits; Cadbury, Milka, Cadbury Dairy Milk, and Toblerone chocolates; Trident gums; Halls candies; and Tang powdered beverages. It sells its products to supermarket chains, wholesalers, supercenters, club stores, mass merchandisers, distributors, convenience stores, gasoline stations, drug stores, value stores, and other retail food outlets through direct store delivery, company-owned and satellite warehouses, distribution centers, and other facilities, as well as through independent sales offices and agents, and e-commerce platforms. The company was formerly known as Kraft Foods Inc. and changed its name to Mondelez International, Inc. in October 2012. Mondelez International, Inc. was founded in 2000 and is based in Deerfield, Illinois.
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