Comparing Brown Forman Corporation (NYSE:BF.B) and Diageo PLC (DEO)
Diageo PLC (NYSE: DEO) and Brown Forman Corporation (NYSE:BF.B) are both large-cap consumer staples companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, valuation, risk, profitabiliy, analyst recommendations, earnings and institutional ownership.
Insider and Institutional Ownership
12.1% of Diageo PLC shares are owned by institutional investors. Comparatively, 25.5% of Brown Forman Corporation shares are owned by institutional investors. 10.1% of Brown Forman Corporation shares are owned 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.
Valuation & Earnings
This table compares Diageo PLC and Brown Forman Corporation’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Diageo PLC||$14.70 billion||5.16||$4.71 billion||N/A||N/A|
|Brown Forman Corporation||N/A||N/A||N/A||$1.70||N/A|
Diageo PLC has higher revenue and earnings than Brown Forman Corporation.
This is a breakdown of current ratings and recommmendations for Diageo PLC and Brown Forman Corporation, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Brown Forman Corporation||1||6||0||0||1.86|
Diageo PLC currently has a consensus price target of $142.00, indicating a potential upside of 17.46%. Brown Forman Corporation has a consensus price target of $48.80, indicating a potential upside of Infinity. Given Brown Forman Corporation’s higher possible upside, analysts plainly believe Brown Forman Corporation is more favorable than Diageo PLC.
Risk and Volatility
Diageo PLC has a beta of 0.74, suggesting that its stock price is 26% less volatile than the S&P 500. Comparatively, Brown Forman Corporation has a beta of 0.95, suggesting that its stock price is 5% less volatile than the S&P 500.
Diageo PLC pays an annual dividend of $3.03 per share and has a dividend yield of 2.5%. Brown Forman Corporation pays an annual dividend of $0.73 per share. Brown Forman Corporation pays out 42.9% of its earnings in the form of a dividend. Brown Forman Corporation has increased its dividend for 5 consecutive years.
This table compares Diageo PLC and Brown Forman Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Brown Forman Corporation||17.29%||51.93%||14.35%|
Brown Forman Corporation beats Diageo PLC on 9 of the 14 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.
Brown Forman Corporation Company Profile
Brown-Forman Corporation is a spirit and wine company. The Company manufactures, bottles, imports, exports, markets and sells a range of alcoholic beverages. The Company has a portfolio of approximately 40 spirit, wine and ready-to-drink cocktail (RTD) brands. Its principal brands include Jack Daniel’s Tennessee Whiskey, Jack Daniel’s RTDs, Jack Daniel’s Tennessee Honey, Gentleman Jack Rare Tennessee Whiskey, Jack Daniel’s Tennessee Fire, Jack Daniel’s Single Barrel Collection, Jack Daniel’s Sinatra Select, Jack Daniel’s Winter Jack, Jack Daniel’s No. 27 Gold Tennessee Whiskey, Finlandia Vodkas, Finlandia RTDs, Korbel California Brandy, Woodford Reserve Kentucky Bourbons, el Jimador Tequilas, el Jimador New Mix RTDs, Herradura Tequilas, Canadian Mist Canadian Whisky, Sonoma-Cutrer California Wines, Early Times Kentucky Whisky and Bourbon, Chambord Liqueur, Old Forester Kentucky Bourbon, Antiguo Tequila, Pepe Lopez Tequila, Santa Dose Cachaca and Collingwood Canadian Whisky.
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