Weis Markets (NYSE: WMK) and SuperValu (NYSE:SVU) are both small-cap retail/wholesale companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, risk, valuation, profitability, earnings, analyst recommendations and institutional ownership.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Weis Markets and SuperValu, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Weis Markets 0 0 0 0 N/A
SuperValu 0 4 2 0 2.33

SuperValu has a consensus price target of $33.60, suggesting a potential upside of 62.24%. Given SuperValu’s higher possible upside, analysts plainly believe SuperValu is more favorable than Weis Markets.

Profitability

This table compares Weis Markets and SuperValu’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Weis Markets 2.42% 8.89% 5.94%
SuperValu 4.46% 220.54% 2.55%

Valuation & Earnings

This table compares Weis Markets and SuperValu’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Weis Markets $3.40 billion 0.34 $173.90 million $3.05 13.99
SuperValu $12.72 billion 0.06 $461.00 million $16.03 1.29

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

Dividends

Weis Markets pays an annual dividend of $1.20 per share and has a dividend yield of 2.8%. SuperValu does not pay a dividend. Weis Markets pays out 39.3% of its earnings in the form of a dividend.

Risk & Volatility

Weis Markets has a beta of 0.72, indicating that its share price is 28% less volatile than the S&P 500. Comparatively, SuperValu has a beta of 2.11, indicating that its share price is 111% more volatile than the S&P 500.

Insider and Institutional Ownership

32.0% of Weis Markets shares are owned by institutional investors. 26.9% of Weis Markets shares are owned by company insiders. Comparatively, 1.7% of SuperValu shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Summary

SuperValu beats Weis Markets on 9 of the 15 factors compared between the two stocks.

Weis Markets Company Profile

Weis Markets, Inc. is engaged principally in the retail sale of food in Pennsylvania and surrounding states. The Company’s retail food stores sell groceries, dairy products, frozen foods, meats, seafood, fresh produce, floral, pharmacy services, deli products, prepared foods, bakery products, beer and wine, fuel and general merchandise items, such as health and beauty care and household products. As of December 31, 2016, it had owned and operated approximately 204 retail food stores. The majority of the Company’s stores are concentrated in central and northeast Pennsylvania, central Maryland, suburban Washington, District of Columbia and Baltimore regions and New York’s Southern Tier. As of December 31, 2016, it had operated four stores in Delaware, 50 stores in Maryland, five stores in New Jersey, nine stores in New York, 121 stores in Pennsylvania, 13 stores in Virginia and two stores in West Virginia, for a total of 204 retail food stores operating under the Weis Markets name.

SuperValu Company Profile

Supervalu Inc. is a wholesale distributor to independent retail customers across the United States. The Company’s segments include Wholesale and Retail. The Company offers a range of advertised brand name and private-label products, including grocery (both perishable and nonperishable), general merchandise and home, health and beauty care, and pharmacy, which are sold through Company-operated and licensed Retail stores to shoppers and through its Wholesale segment to independent retail customers. The Company’s Wholesale segment provides wholesale distribution of products to independent retail customers. Wholesale is organized and operated through two geographic regions: East and West. As of February 27, 2016, the Company conducted its Retail operations through a total of 200 stores primarily organized under five regionally-based retail banners of Cub Foods, Shoppers Food & Pharmacy, Shop ‘n Save, Farm Fresh and Hornbacher’s, as well as two Rainbow and two County Market stores.

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