Critical Contrast: Pilgrim’s Pride Corporation (NASDAQ:PPC) versus Tyson Foods (TSN)
Pilgrim’s Pride Corporation (NASDAQ: PPC) and Tyson Foods (NYSE:TSN) are both mid-cap consumer staples companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitabiliy, earnings, analyst recommendations, dividends, institutional ownership, valuation and risk.
This is a breakdown of current ratings for Pilgrim’s Pride Corporation and Tyson Foods, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Pilgrim’s Pride Corporation||0||2||3||0||2.60|
Pilgrim’s Pride Corporation presently has a consensus target price of $23.33, indicating a potential upside of 3.98%. Tyson Foods has a consensus target price of $67.70, indicating a potential upside of 10.28%. Given Tyson Foods’ higher probable upside, analysts plainly believe Tyson Foods is more favorable than Pilgrim’s Pride Corporation.
This table compares Pilgrim’s Pride Corporation and Tyson Foods’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Pilgrim’s Pride Corporation||5.21%||46.08%||13.31%|
Valuation and Earnings
This table compares Pilgrim’s Pride Corporation and Tyson Foods’ top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Pilgrim’s Pride Corporation||$7.99 billion||0.70||$862.84 million||$1.65||13.60|
|Tyson Foods||$36.82 billion||0.61||$3.77 billion||$4.79||12.82|
Tyson Foods has higher revenue and earnings than Pilgrim’s Pride Corporation. Tyson Foods is trading at a lower price-to-earnings ratio than Pilgrim’s Pride Corporation, indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
Pilgrim’s Pride Corporation has a beta of 0.16, meaning that its stock price is 84% less volatile than the S&P 500. Comparatively, Tyson Foods has a beta of 0.25, meaning that its stock price is 75% less volatile than the S&P 500.
Tyson Foods pays an annual dividend of $0.90 per share and has a dividend yield of 1.5%. Pilgrim’s Pride Corporation does not pay a dividend. Tyson Foods pays out 18.8% of its earnings in the form of a dividend. Tyson Foods has increased its dividend for 5 consecutive years.
Institutional and Insider Ownership
26.6% of Pilgrim’s Pride Corporation shares are owned by institutional investors. Comparatively, 72.3% of Tyson Foods shares are owned by institutional investors. 78.8% of Pilgrim’s Pride Corporation shares are owned by company insiders. Comparatively, 2.7% of Tyson Foods shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Tyson Foods beats Pilgrim’s Pride Corporation on 9 of the 17 factors compared between the two stocks.
Pilgrim’s Pride Corporation Company Profile
Pilgrim’s Pride Corporation is a retail feed store. It is a producer and seller of chicken with operations in the United States, Mexico and Puerto Rico. It is engaged in the production, processing, marketing and distribution of fresh, frozen and value-added chicken products to retailers, distributors and foodservice operators. It offers a range of products to its customers through national and international distribution channels. Its fresh chicken products consist of refrigerated (non-frozen) whole chickens, whole cut-up chickens and selected chicken parts that are either marinated or non-marinated. Its prepared chicken products include ready-to-cook and individually frozen chicken parts, strips, nuggets and patties, some of which are either breaded or non-breaded and either marinated or non-marinated. As of December 25, 2016, the Company marketed its portfolio of fresh, prepared and value-added chicken products across the United States, Mexico and in approximately 80 other countries.
Tyson Foods Company Profile
Tyson Foods, Inc. is a food company, which is engaged in offering chicken, beef and pork, as well as prepared foods. The Company offers food products under Tyson, Jimmy Dean, Hillshire Farm, Sara Lee, Ball Park, Wright, Aidells and State Fair brands. The Company operates through four segments: Chicken, Beef, Pork and Prepared Foods. It operates a vertically integrated chicken production process, which consists of breeding stock, contract growers, feed production, processing, further-processing, marketing and transportation of chicken and related allied products, including animal and pet food ingredients. Through its subsidiary, Cobb-Vantress, Inc. (Cobb), the Company is engaged in supplying poultry breeding stock across the world. It produces a range of fresh, frozen and refrigerated food products. Its products are marketed and sold by its sales staff to grocery retailers, grocery wholesalers, meat distributors, warehouse club stores and military commissaries, among others.
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