Head to Head Analysis: Freshpet (NASDAQ:FRPT) and Vital Farms (NASDAQ:VITL)

Freshpet (NASDAQ:FRPT) and Vital Farms (NASDAQ:VITL) are both consumer staples companies, but which is the better stock? We will compare the two businesses based on the strength of their valuation, risk, institutional ownership, analyst recommendations, earnings, profitability and dividends.

Risk & Volatility

Freshpet has a beta of 1.72, meaning that its share price is 72% more volatile than the S&P 500. Comparatively, Vital Farms has a beta of 1.06, meaning that its share price is 6% more volatile than the S&P 500.

Earnings and Valuation

This table compares Freshpet and Vital Farms”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Freshpet	$975.18 million	3.23	$46.92 million	$2.29	28.17
Vital Farms	$606.31 million	2.41	$53.39 million	$1.32	24.69

Vital Farms has lower revenue, but higher earnings than Freshpet. Vital Farms is trading at a lower price-to-earnings ratio than Freshpet, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Freshpet and Vital Farms’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Freshpet	11.44%	5.73%	3.83%
Vital Farms	8.50%	20.19%	14.69%

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Freshpet and Vital Farms, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Freshpet	2	10	6	0	2.22
Vital Farms	0	2	13	0	2.87

Freshpet presently has a consensus price target of $82.63, suggesting a potential upside of 28.08%. Vital Farms has a consensus price target of $49.91, suggesting a potential upside of 53.14%. Given Vital Farms’ stronger consensus rating and higher probable upside, analysts plainly believe Vital Farms is more favorable than Freshpet.

Insider & Institutional Ownership

98.6% of Vital Farms shares are held by institutional investors. 4.4% of Freshpet shares are held by company insiders. Comparatively, 21.3% of Vital Farms shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

Vital Farms beats Freshpet on 8 of the 14 factors compared between the two stocks.

About Freshpet

Freshpet, Inc., together with its subsidiaries, manufactures, distributes, and markets natural fresh meals and treats for dogs and cats in the United States, Canada, and Europe. It sells dog food, cat food, and dog treats under the Freshpet brand name; and Dognation and Dog Joy labels through various classes of retail, including grocery, mass, club, pet specialty, and natural, as well as online. The company was incorporated in 2004 and is headquartered in Secaucus, New Jersey.

About Vital Farms

Vital Farms, Inc., a food company, provides pasture-raised products in the United States. It offers shell eggs, butter, hard-boiled eggs, and liquid whole eggs. The company was founded in 2007 and is headquartered in Austin, Texas.