Mama’s Creations (NASDAQ:MAMA) and Marzetti (NASDAQ:MZTI) Critical Comparison

Mama’s Creations (NASDAQ:MAMA) and Marzetti (NASDAQ:MZTI) are both consumer staples companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, earnings, dividends, risk, valuation, analyst recommendations and institutional ownership.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Mama’s Creations and Marzetti, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Mama’s Creations	0	1	5	0	2.83
Marzetti	1	2	1	0	2.00

Mama’s Creations presently has a consensus target price of $18.80, suggesting a potential upside of 30.56%. Marzetti has a consensus target price of $169.33, suggesting a potential upside of 48.19%. Given Marzetti’s higher probable upside, analysts clearly believe Marzetti is more favorable than Mama’s Creations.

Profitability

This table compares Mama’s Creations and Marzetti’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Mama’s Creations	3.06%	15.31%	8.85%
Marzetti	9.06%	18.12%	14.01%

Valuation & Earnings

This table compares Mama’s Creations and Marzetti”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Mama’s Creations	$171.71 million	3.41	$5.29 million	$0.12	120.00
Marzetti	$1.91 billion	1.64	$167.35 million	$6.39	17.88

Marzetti has higher revenue and earnings than Mama’s Creations. Marzetti is trading at a lower price-to-earnings ratio than Mama’s Creations, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

45.2% of Mama’s Creations shares are held by institutional investors. Comparatively, 66.4% of Marzetti shares are held by institutional investors. 6.5% of Mama’s Creations shares are held by insiders. Comparatively, 29.1% of Marzetti shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Risk & Volatility

Mama’s Creations has a beta of 0.64, meaning that its share price is 36% less volatile than the S&P 500. Comparatively, Marzetti has a beta of 0.38, meaning that its share price is 62% less volatile than the S&P 500.

Summary

Marzetti beats Mama’s Creations on 9 of the 14 factors compared between the two stocks.

About Mama’s Creations

Mama’s Creations, Inc. engages in the marketing, manufacturing, and distribution of beef meatballs with sauce, turkey meatballs with sauce, beef meat loaf, sausage and peppers, chicken parmesan, and other similar meats and sauces. Its products include beef meatballs, turkey meatballs, stuffed meatballs, lasagna roll ups, retail ready meals, bulk deli, single-size pasta bowls, and packaged refrigerated products. Its brands include MamaMancini’s, Creative Salads, and The Olive Branch. The company was founded by Daniel Dougherty on July 22, 2009 and is headquartered in East Rutherford, NJ.

About Marzetti

Lancaster Colony Corporation engages in the manufacturing and marketing of specialty food products for the retail and foodservice channels in the United States. It operates in two segments, Retail and Foodservice. The company offers frozen garlic bread under the New York BRAND Bakery; frozen Parkerhouse style yeast and dinner rolls under the Sister Schubert's brand; salad dressings under the Marzetti, Simply Dressed, Cardini's, and Girard's brands; vegetable and fruit dips under the Marzetti brand; croutons and salad toppings under the New York BRAND Bakery, Chatham Village, and Marzetti brands; and frozen pasta under the Marzetti Frozen Pasta brand. It also manufactures and sells other products to brand license agreements, including Olive Garden dressings, Buffalo Wild Wings sauces, and Chick-fil-A sauces. The company sells its products through sales personnel, food brokers, and distributors to retailers and restaurants. Lancaster Colony Corporation was incorporated in 1961 and is based in Westerville, Ohio.