Kellogg (NYSE: K) and Ingredion (NYSE:INGR) are both mid-cap consumer staples companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, earnings, risk, institutional ownership, valuation, analyst recommendations and dividends.

Valuation and Earnings

This table compares Kellogg and Ingredion’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Kellogg $12.79 billion 1.83 $2.27 billion $2.21 30.66
Ingredion $5.80 billion 1.53 $1.05 billion $6.65 18.63

Kellogg has higher revenue and earnings than Ingredion. Ingredion is trading at a lower price-to-earnings ratio than Kellogg, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Kellogg and Ingredion, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Kellogg 1 6 2 0 2.11
Ingredion 0 3 2 0 2.40

Kellogg presently has a consensus target price of $74.78, suggesting a potential upside of 10.37%. Ingredion has a consensus target price of $141.67, suggesting a potential upside of 14.32%. Given Ingredion’s stronger consensus rating and higher probable upside, analysts plainly believe Ingredion is more favorable than Kellogg.

Profitability

This table compares Kellogg and Ingredion’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Kellogg 6.12% 70.22% 9.15%
Ingredion 8.35% 20.84% 9.53%

Insider & Institutional Ownership

85.4% of Kellogg shares are owned by institutional investors. Comparatively, 84.3% of Ingredion shares are owned by institutional investors. 1.3% of Kellogg shares are owned by company insiders. Comparatively, 1.9% of Ingredion shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Dividends

Kellogg pays an annual dividend of $2.16 per share and has a dividend yield of 3.2%. Ingredion pays an annual dividend of $2.00 per share and has a dividend yield of 1.6%. Kellogg pays out 97.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Ingredion pays out 30.1% of its earnings in the form of a dividend. Kellogg has increased its dividend for 4 consecutive years and Ingredion has increased its dividend for 12 consecutive years.

Volatility and Risk

Kellogg has a beta of 0.49, indicating that its share price is 51% less volatile than the S&P 500. Comparatively, Ingredion has a beta of 0.6, indicating that its share price is 40% less volatile than the S&P 500.

Summary

Ingredion beats Kellogg on 9 of the 16 factors compared between the two stocks.

Kellogg Company Profile

Kellogg Company is a manufacturer and marketer of ready-to-eat cereal and convenience foods. The Company’s principal products are ready-to-eat cereals and convenience foods, such as cookies, crackers, savory snacks, toaster pastries, cereal bars, fruit-flavored snacks, frozen waffles and veggie foods. Its segments include U.S. Morning Foods, which includes cereal, toaster pastries, health and wellness bars, and beverages; U.S. Snacks, which includes cookies, crackers, cereal bars, savory snacks and fruit-flavored snacks; U.S. Specialty, which represents food away from home channels, including food service, convenience, vending, Girl Scouts and food manufacturing; North America Other, which includes the U.S. Frozen, Kashi and Canada operating segments; Europe, which consists of European countries; Latin America, which consists of Central and South America and includes Mexico, and Asia Pacific, which consists of Sub-Saharan Africa, Australia and other Asian and Pacific markets.

Ingredion Company Profile

Ingredion Incorporated is an ingredients solutions provider. The Company manufactures and sells sweetener, starches, nutrition ingredients and biomaterial solutions derived from the wet milling and processing of corn and other starch-based materials to a range of industries, both domestically and internationally. It operates through four segments: North America, South America, Asia Pacific, and Europe, Middle East and Africa (EMEA). It turns corn, tapioca, potatoes, and other vegetables and fruits into ingredients and biomaterials for the food, beverage, paper and corrugating, brewing and other industries. Its product line includes animal feed products and edible corn oil. Its sweetener products include glucose syrups, high maltose syrup, high fructose corn syrup (HFCS), caramel color, dextrose, polyols, maltodextrins and glucose and syrup solids. Its starch-based products include both food-grade and industrial starches, and biomaterials. It also offers specialty ingredients.

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