Penford Corp (NASDAQ: PENX) and Ingredion (NYSE:INGR) are both non-cyclical consumer goods & services companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, dividends, risk, institutional ownership, profitability, valuation and earnings.

Dividends

Ingredion pays an annual dividend of $2.00 per share and has a dividend yield of 1.6%. Penford Corp does not pay a dividend. Ingredion pays out 30.1% of its earnings in the form of a dividend. Ingredion has increased its dividend for 4 consecutive years.

Valuation & Earnings

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

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Penford Corp N/A N/A N/A N/A N/A
Ingredion $5.80 billion 1.54 $1.05 billion $6.65 18.68

Ingredion has higher revenue and earnings than Penford Corp.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Penford Corp and Ingredion, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Penford Corp 0 0 0 0 N/A
Ingredion 0 2 2 0 2.50

Ingredion has a consensus price target of $141.67, indicating a potential upside of 14.04%. Given Ingredion’s higher possible upside, analysts clearly believe Ingredion is more favorable than Penford Corp.

Profitability

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

Net Margins Return on Equity Return on Assets
Penford Corp 2.06% 8.92% 3.56%
Ingredion 8.35% 20.84% 9.53%

Institutional and Insider Ownership

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

Summary

Ingredion beats Penford Corp on 10 of the 11 factors compared between the two stocks.

Penford Corp Company Profile

Penford Corporation (Penford) is a developer, manufacturer and marketer of natural-based ingredient systems for food and industrial applications, including fuel grade ethanol. The Company has research and development capabilities, which are used in understanding the complex chemistry of carbohydrate-based materials and in developing applications to address customer needs. Penford operates in two business segments: Industrial Ingredients and Food Ingredients. Industrial Ingredients segment is a supplier of chemically modified starches to the paper and packaging industries. Industrial Ingredients also produces food grade corn starch for sale by the Company’s Food Ingredients business. Food Ingredients segment is a developer and manufacturer of specialty starches and dextrins to the food manufacturing and food service industries. This business is engaged is in leveraging the inherent characteristics from potato, corn, tapioca and rice to help improve its customers’ product performance.

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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