Colgate-Palmolive (NYSE:CL) vs. Grocery Outlet (NASDAQ:GO) Financial Comparison

Colgate-Palmolive (NYSE:CL) and Grocery Outlet (NASDAQ:GO) are both consumer staples companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, risk, analyst recommendations, earnings, valuation, dividends and institutional ownership.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Colgate-Palmolive	10.04%	386.76%	17.89%
Grocery Outlet	-8.08%	5.69%	1.86%

Volatility and Risk

Colgate-Palmolive has a beta of 0.33, suggesting that its share price is 67% less volatile than the S&P 500. Comparatively, Grocery Outlet has a beta of 0.67, suggesting that its share price is 33% less volatile than the S&P 500.

Institutional & Insider Ownership

80.4% of Colgate-Palmolive shares are held by institutional investors. Comparatively, 99.9% of Grocery Outlet shares are held by institutional investors. 0.4% of Colgate-Palmolive 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 stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and target prices for Colgate-Palmolive and Grocery Outlet, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Colgate-Palmolive	0	6	12	0	2.67
Grocery Outlet	2	11	0	0	1.85

Colgate-Palmolive currently has a consensus target price of $95.88, suggesting a potential upside of 8.20%. Grocery Outlet has a consensus target price of $10.32, suggesting a potential upside of 20.54%. Given Grocery Outlet’s higher possible upside, analysts plainly believe Grocery Outlet is more favorable than Colgate-Palmolive.

Valuation & Earnings

This table compares Colgate-Palmolive and Grocery Outlet”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Colgate-Palmolive	$20.38 billion	3.48	$2.13 billion	$2.57	34.48
Grocery Outlet	$4.69 billion	0.18	-$224.91 million	($3.88)	-2.21

Colgate-Palmolive has higher revenue and earnings than Grocery Outlet. Grocery Outlet is trading at a lower price-to-earnings ratio than Colgate-Palmolive, indicating that it is currently the more affordable of the two stocks.

Summary

Colgate-Palmolive beats Grocery Outlet on 10 of the 14 factors compared between the two stocks.

About Colgate-Palmolive

Colgate-Palmolive Company, together with its subsidiaries, manufactures and sells consumer products in the United States and internationally. It operates through two segments: Oral, Personal and Home Care; and Pet Nutrition. The Oral, Personal and Home Care segment offers toothpaste, toothbrushes, mouthwash, bar and liquid hand soaps, shower gels, shampoos, conditioners, deodorants and antiperspirants, skin health products, dishwashing detergents, fabric conditioners, household cleaners, and other related items. This segment markets and sells its products under various brands, which include Colgate, Darlie, elmex, hello, meridol, Sorriso, Tom's of Maine, Irish Spring, Palmolive, Protex, Sanex, Softsoap, Lady Speed Stick, Speed Stick, EltaMD, Filorga, PCA SKIN, Ajax, Axion, Fabuloso, Murphy, Suavitel, and Soupline to a range of traditional and eCommerce retailers, wholesalers, and distributors. It includes pharmaceutical products for dentists and other oral health professionals. Its Pet Nutrition segment offers pet nutrition products for everyday nutritional needs under the Hill's Science Diet brand; and a range of therapeutic pet products to help nutritionally support dogs and cats in different stages of health under the Hill's Prescription Diet brand. This segment markets and sells its products through pet supply retailers, veterinarians, and eCommerce retailers. Colgate-Palmolive Company was founded in 1806 and is headquartered in New York, New York.

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.