Treehouse Foods (NYSE: THS) and J.M. Smucker Company (The) (NYSE:SJM) are both mid-cap consumer staples companies, but which is the superior business? We will compare the two companies based on the strength of their analyst recommendations, risk, profitabiliy, dividends, valuation, institutional ownership and earnings.

Profitability

This table compares Treehouse Foods and J.M. Smucker Company (The)’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Treehouse Foods -3.12% 6.50% 2.56%
J.M. Smucker Company (The) 8.01% 12.63% 5.64%

Risk and Volatility

Treehouse Foods has a beta of 0.54, suggesting that its stock price is 46% less volatile than the S&P 500. Comparatively, J.M. Smucker Company (The) has a beta of 0.62, suggesting that its stock price is 38% less volatile than the S&P 500.

Dividends

J.M. Smucker Company (The) pays an annual dividend of $3.00 per share and has a dividend yield of 2.5%. Treehouse Foods does not pay a dividend. J.M. Smucker Company (The) pays out 58.8% of its earnings in the form of a dividend. J.M. Smucker Company (The) has increased its dividend for 15 consecutive years.

Valuation & Earnings

This table compares Treehouse Foods and J.M. Smucker Company (The)’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Treehouse Foods $6.44 billion 0.74 $646.00 million ($3.55) -23.61
J.M. Smucker Company (The) $7.39 billion 1.82 $1.67 billion $5.10 23.23

J.M. Smucker Company (The) has higher revenue and earnings than Treehouse Foods. Treehouse Foods is trading at a lower price-to-earnings ratio than J.M. Smucker Company (The), indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

75.1% of J.M. Smucker Company (The) shares are owned by institutional investors. 3.5% of Treehouse Foods shares are owned by company insiders. Comparatively, 3.5% of J.M. Smucker Company (The) shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and price targets for Treehouse Foods and J.M. Smucker Company (The), as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Treehouse Foods 1 3 6 0 2.50
J.M. Smucker Company (The) 2 6 3 0 2.09

Treehouse Foods currently has a consensus target price of $92.67, suggesting a potential upside of 10.58%. J.M. Smucker Company (The) has a consensus target price of $131.91, suggesting a potential upside of 11.33%. Given J.M. Smucker Company (The)’s higher probable upside, analysts clearly believe J.M. Smucker Company (The) is more favorable than Treehouse Foods.

Summary

J.M. Smucker Company (The) beats Treehouse Foods on 12 of the 16 factors compared between the two stocks.

Treehouse Foods Company Profile

TreeHouse Foods, Inc. is a consumer packaged food and beverage manufacturer. The Company’s segments include North American Retail Grocery, Food Away From Home, and Industrial and Export. The Company manufactures a range of shelf stable, refrigerated, fresh and frozen products. Its product categories include beverages, salad dressings, snack nuts, beverage enhancers, pickles, sauces, cereals, pasta and dry dinners, cookies and crackers, retail bakery, aseptic products, jams and other products. The North American Retail Grocery segment sells branded and private label products to customers within the United States and Canada. The Food Away From Home segment sells products to foodservice customers, including restaurant chains and food distribution companies within the United States and Canada. The Industrial and Export segment includes the Company’s co-pack business and non-dairy powdered creamer sales to industrial customers for use in industrial applications.

J.M. Smucker Company (The) Company Profile

The J. M. Smucker Company is a manufacturer and marketer of branded food and beverage products and pet food and pet snacks in North America. The Company’s segments include U.S. Retail Coffee, U.S. Retail Consumer Foods, U.S. Retail Pet Foods, and International and Foodservice. The Company’s U.S. retail market segments consist of the sale of branded food products to consumers through retail outlets in North America. In the U.S. retail market segments, the Company’s products are sold to food retailers, food wholesalers, drug stores, club stores, mass merchandisers, discount and dollar stores, military commissaries, natural foods stores and distributors, and pet specialty stores. In International and Foodservice, the Company’s products are distributed domestically and in foreign countries through retail channels and foodservice distributors and operators, such as restaurants, lodging, schools and universities, healthcare operators.

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