Castle Brands (NYSE: ROX) and Brown Forman Corporation (NYSE:BF.B) are both non-cyclical consumer goods & services companies, but which is the superior stock? We will compare the two businesses based on the strength of their earnings, risk, valuation, profitabiliy, dividends, analyst recommendations and institutional ownership.

Institutional and Insider Ownership

25.5% of Brown Forman Corporation shares are owned by institutional investors. 10.1% of Brown Forman Corporation shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares Castle Brands and Brown Forman Corporation’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Castle Brands $69.62 million 4.31 $2.94 million N/A N/A
Brown Forman Corporation N/A N/A N/A $1.70 N/A

Castle Brands has higher revenue and earnings than Brown Forman Corporation.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Castle Brands and Brown Forman Corporation, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Castle Brands 0 0 0 0 N/A
Brown Forman Corporation 1 6 0 0 1.86

Brown Forman Corporation has a consensus price target of $48.80, suggesting a potential upside of Infinity. Given Brown Forman Corporation’s higher probable upside, analysts clearly believe Brown Forman Corporation is more favorable than Castle Brands.

Dividends

Brown Forman Corporation pays an annual dividend of $0.73 per share. Castle Brands does not pay a dividend. Brown Forman Corporation pays out 42.9% of its earnings in the form of a dividend.

Profitability

This table compares Castle Brands and Brown Forman Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Castle Brands 3.10% 6.81% 5.19%
Brown Forman Corporation 17.29% 51.93% 14.35%

Summary

Brown Forman Corporation beats Castle Brands on 6 of the 8 factors compared between the two stocks.

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.

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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