Head to Head Contrast: McCormick & Company, (MKC) versus Penford Corp (PENX)
McCormick & Company, (NYSE: MKC) and Penford Corp (NASDAQ:PENX) are both consumer staples companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, profitability, earnings, risk, dividends, valuation and analyst recommendations.
Insider and Institutional Ownership
70.0% of McCormick & Company, shares are owned by institutional investors. 15.3% of McCormick & Company, shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Earnings and Valuation
This table compares McCormick & Company, and Penford Corp’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|McCormick & Company,||$4.57 billion||2.60||$797.30 million||$3.62||27.39|
McCormick & Company, has higher revenue and earnings than Penford Corp.
This is a breakdown of current recommendations and price targets for McCormick & Company, and Penford Corp, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|McCormick & Company,||0||6||4||0||2.40|
McCormick & Company, currently has a consensus price target of $104.56, indicating a potential upside of 5.44%. Given McCormick & Company,’s higher possible upside, analysts clearly believe McCormick & Company, is more favorable than Penford Corp.
This table compares McCormick & Company, and Penford Corp’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|McCormick & Company,||10.05%||26.09%||8.17%|
McCormick & Company, pays an annual dividend of $1.88 per share and has a dividend yield of 1.9%. Penford Corp does not pay a dividend. McCormick & Company, pays out 51.9% of its earnings in the form of a dividend. McCormick & Company, has increased its dividend for 30 consecutive years.
McCormick & Company, beats Penford Corp on 10 of the 11 factors compared between the two stocks.
About McCormick & Company,
McCormick & Company, Incorporated is engaged in manufacturing, marketing and distributing spices, seasoning mixes, condiments and other flavorful products to the food industry, including retailers, food manufacturers and foodservice businesses. The Company’s segments include consumer and industrial. The Company is involved in the manufacturing and sales of flavorful products. As of November 30, 2016, it offered brands for consumers in approximately 150 countries and territories. The Company’s brands in the Americas include McCormick, Lawry’s, and Club House, as well as brands, such as Gourmet Garden and OLD BAY. It provides a range of products to food manufacturers and foodservice customers. The Company’s sales, distribution and production facilities are located in North America, Europe and China. It markets regional and ethnic brands, such as Zatarain’s, Stubb’s, Thai Kitchen and Simply Asia. The Company offers sensory testing, culinary research, food safety and flavor application.
About Penford Corp
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.
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