Analyzing Unilever (NYSE:UL) and Grocery Outlet (NASDAQ:GO)

Unilever (NYSE:UL) and Grocery Outlet (NASDAQ:GO) are both consumer staples companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, analyst recommendations, earnings, risk, institutional ownership, profitability and dividends.

Analyst Ratings

This is a summary of current ratings and recommmendations for Unilever and Grocery Outlet, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Unilever	2	3	4	0	2.22
Grocery Outlet	2	7	4	0	2.15

Unilever presently has a consensus target price of $65.55, suggesting a potential downside of 4.06%. Grocery Outlet has a consensus target price of $14.50, suggesting a potential upside of 52.15%. Given Grocery Outlet’s higher possible upside, analysts clearly believe Grocery Outlet is more favorable than Unilever.

Earnings & Valuation

This table compares Unilever and Grocery Outlet”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Unilever	$65.76 billion	2.27	$6.22 billion	N/A	N/A
Grocery Outlet	$4.57 billion	0.20	$39.47 million	($0.05)	-190.60

Unilever has higher revenue and earnings than Grocery Outlet.

Institutional and Insider Ownership

9.7% of Unilever shares are held by institutional investors. Comparatively, 99.9% of Grocery Outlet shares are held by institutional investors. 1.0% of Unilever shares are held by company insiders. Comparatively, 4.5% of Grocery Outlet shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Unilever and Grocery Outlet’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Unilever	N/A	N/A	N/A
Grocery Outlet	-0.10%	5.86%	2.13%

Volatility & Risk

Unilever has a beta of 0.36, meaning that its share price is 64% less volatile than the S&P 500. Comparatively, Grocery Outlet has a beta of 0.47, meaning that its share price is 53% less volatile than the S&P 500.

Summary

Grocery Outlet beats Unilever on 6 of the 11 factors compared between the two stocks.

About Unilever

Unilever PLC operates as a fast-moving consumer goods company in the Asia Pacific, Africa, the Americas, and Europe. It operates through five segments: Beauty & Wellbeing, Personal Care, Home Care, Nutrition, and Ice Cream. The Beauty & Wellbeing segment engages in the sale of hair care products, such as shampoo, conditioner, and styling; skin care products including face, hand, and body moisturizer; and prestige beauty and health & wellbeing products consist of the vitamins, minerals, and supplements. The Personal Care segment offers skin cleansing products comprising soap and shower; deodorants; and oral care products, such as toothpaste, toothbrush, and mouthwash products. The Home Care segment is involved in the sale of fabric care products, including washing powders and liquids, and rinse conditioners; and fabric enhancers, and home and hygiene products. The Nutrition segment provides dressings products, such as mayonnaise and ketchup; sells scratch cooking aids consist of soups, bouillons, and seasonings; plant-based meat; beverages; and functional nutrition products, including Horlicks and Boost, as well as tea products. The Ice Cream segment offers ice cream products including in-home and out-of-home ice creams. The company provides its products under the AXE, Ben & Jerry's, Cif, Clear, Closeup, Comfort, Cornetto, Dermalogica, Domestos, Dove, Dove Men+Care, Hellmann's, Horlicks, Knorr, LUX, Lifebuoy, Liquid I.V., Magnum, Nutrafol, OMO, Paula's Choice, Pepsodent, Pond's, Rexona, Rexona, Sunlight, Sunsilk, Surf, TRESemmé, Vaseline, Wall's, Breyers, and Yasso brand names. Unilever PLC was founded in 1860 and is headquartered in London, the United Kingdom.

About Grocery Outlet

Grocery Outlet Holding Corp. operates as a retailer of consumables and fresh products sold through independently operated stores in the United States. Its stores offer products in various categories, such as dairy and deli, produce, floral, fresh meat, seafood products, grocery, general merchandise, health and beauty care, frozen food, beer and wine, and ethnic products. The company was founded in 1946 and is headquartered in Emeryville, California.