Archer Daniels Midland (NYSE: ADM) and Kraft Heinz Foods (NYSE:HNZ) are both large-cap non-cyclical consumer goods & services companies, but which is the superior business? We will compare the two businesses based on the strength of their risk, institutional ownership, earnings, dividends, valuation, profitability and analyst recommendations.
Insider & Institutional Ownership
76.0% of Archer Daniels Midland shares are held by institutional investors. 2.7% of Archer Daniels Midland shares are held by 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.
This is a breakdown of recent recommendations for Archer Daniels Midland and Kraft Heinz Foods, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Archer Daniels Midland||1||6||1||0||2.00|
|Kraft Heinz Foods||0||2||1||0||2.33|
Archer Daniels Midland currently has a consensus target price of $41.57, suggesting a potential upside of 3.46%. Kraft Heinz Foods has a consensus target price of $17.65, suggesting a potential downside of 5.87%. Given Archer Daniels Midland’s higher possible upside, equities analysts plainly believe Archer Daniels Midland is more favorable than Kraft Heinz Foods.
This table compares Archer Daniels Midland and Kraft Heinz Foods’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Archer Daniels Midland||2.01%||7.86%||3.49%|
|Kraft Heinz Foods||N/A||N/A||N/A|
Archer Daniels Midland pays an annual dividend of $1.28 per share and has a dividend yield of 3.2%. Kraft Heinz Foods does not pay a dividend. Archer Daniels Midland pays out 60.1% of its earnings in the form of a dividend. Kraft Heinz Foods has raised its dividend for 42 consecutive years.
Valuation & Earnings
This table compares Archer Daniels Midland and Kraft Heinz Foods’ top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Archer Daniels Midland||$62.35 billion||0.36||$1.28 billion||$2.13||18.86|
|Kraft Heinz Foods||N/A||N/A||N/A||$3.26||5.75|
Archer Daniels Midland has higher revenue and earnings than Kraft Heinz Foods. Kraft Heinz Foods is trading at a lower price-to-earnings ratio than Archer Daniels Midland, indicating that it is currently the more affordable of the two stocks.
Archer Daniels Midland beats Kraft Heinz Foods on 9 of the 13 factors compared between the two stocks.
Archer Daniels Midland Company Profile
Archer-Daniels-Midland Company is a processor of oilseeds, corn, wheat, cocoa and other agricultural commodities. The Company manufactures protein meal, vegetable oil, corn sweeteners, flour, biodiesel, ethanol, and other food and feed ingredients. Its segments include Agricultural Services, which utilizes its United States grain elevator, global transportation network and port operations to buy, store, clean and transport agricultural commodities, such as oilseeds, wheat, milo, oats, rice and barley, and resells these commodities primarily as food and feed ingredients and as raw materials for the agricultural processing industry; Corn Processing, which is engaged in corn wet milling and dry milling activities; Oilseeds Processing, which includes global activities related to the origination, merchandising, crushing and further processing of oilseeds; Wild Flavors and Specialty Ingredients products, which include flavors, sweeteners and health ingredients; Other, and Corporate.
Kraft Heinz Foods Company Profile
H. J. Heinz Company, together with its subsidiaries, is engaged in manufacturing and marketing a range of food products throughout the world. The Company’s principal products include ketchup, condiments and sauces, frozen food, soups, beans and pasta meals, infant nutrition and other food products. The Company’s products are manufactured and packaged to provide wholesome foods for consumers, as well as foodservice and institutional customers. The Company manufactures and contracts for the manufacture of its products from a variety of raw food materials. The Company operates in five segments: North American Consumer Products, Europe, Asia/Pacific, U.S. Foodservice and Rest of World. The Company owns or leases office space, warehouses, distribution centers and research and other facilities throughout the world.
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