Penford (NASDAQ: PENX) and MGP Ingredients (NASDAQ:MGPI) are both small-cap non-cyclical consumer goods & services companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, dividends, analyst recommendations, institutional ownership, valuation, risk and earnings.
Volatility and Risk
Penford has a beta of 0.71, meaning that its share price is 29% less volatile than the S&P 500. Comparatively, MGP Ingredients has a beta of 0.95, meaning that its share price is 5% less volatile than the S&P 500.
This table compares Penford and MGP Ingredients’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Valuation & Earnings
This table compares Penford and MGP Ingredients’ revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|MGP Ingredients||$328.08 million||4.02||$31.18 million||$2.18||36.18|
MGP Ingredients has higher revenue and earnings than Penford. Penford is trading at a lower price-to-earnings ratio than MGP Ingredients, indicating that it is currently the more affordable of the two stocks.
This is a summary of recent recommendations for Penford and MGP Ingredients, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
MGP Ingredients has a consensus target price of $68.33, suggesting a potential downside of 13.37%. Given MGP Ingredients’ higher possible upside, analysts plainly believe MGP Ingredients is more favorable than Penford.
MGP Ingredients pays an annual dividend of $0.16 per share and has a dividend yield of 0.2%. Penford does not pay a dividend. MGP Ingredients pays out 7.3% of its earnings in the form of a dividend.
MGP Ingredients beats Penford on 10 of the 11 factors compared between the two stocks.
Penford 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.
MGP Ingredients Company Profile
MGP Ingredients, Inc. is a producer and supplier of distilled spirits, and specialty wheat protein and starch food ingredients. The Company’s distilled spirits include bourbon and rye whiskeys, and grain neutral spirits, including vodka and gin. The Company’s segments include distillery products and ingredient solutions. The distillery products segment consists of food grade alcohol and distillery co-products, such as distillers feed and fuel grade alcohol. The ingredient solutions segment consists of specialty starches and proteins, commodity starches and commodity proteins. The distillery products segment also includes warehouse services, including barrel put away, barrel storage, and barrel retrieval services. It is also a producer of industrial alcohol for use in both food and non-food applications. The Company’s distillery products are derived from corn and other grains (including rye, barley, wheat, barley malt and milo), and its ingredient products are derived from wheat flour.
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