Ingredion (NYSE: INGR) and Penford Corp (NASDAQ:PENX) are both consumer staples companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, risk, dividends, earnings, analyst recommendations, institutional ownership and profitability.

Profitability

This table compares Ingredion and Penford Corp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ingredion 8.35% 20.84% 9.53%
Penford Corp 2.06% 8.92% 3.56%

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Ingredion and Penford Corp, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ingredion 0 2 2 0 2.50
Penford Corp 0 0 0 0 N/A

Ingredion presently has a consensus price target of $141.67, suggesting a potential upside of 13.74%. Given Ingredion’s higher probable upside, equities research analysts clearly believe Ingredion is more favorable than Penford Corp.

Valuation and Earnings

This table compares Ingredion and Penford Corp’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Ingredion $5.80 billion 1.54 $1.05 billion $6.65 18.73
Penford Corp N/A N/A N/A N/A N/A

Ingredion has higher revenue and earnings than Penford Corp.

Dividends

Ingredion pays an annual dividend of $2.00 per share and has a dividend yield of 1.6%. Penford Corp does not pay a dividend. Ingredion pays out 30.1% of its earnings in the form of a dividend. Penford Corp has increased its dividend for 4 consecutive years.

Insider and Institutional Ownership

84.3% of Ingredion shares are owned by institutional investors. 1.9% of Ingredion shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

Ingredion beats Penford Corp on 9 of the 11 factors compared between the two stocks.

Ingredion Company Profile

Ingredion Incorporated is an ingredients solutions provider. The Company manufactures and sells sweetener, starches, nutrition ingredients and biomaterial solutions derived from the wet milling and processing of corn and other starch-based materials to a range of industries, both domestically and internationally. It operates through four segments: North America, South America, Asia Pacific, and Europe, Middle East and Africa (EMEA). It turns corn, tapioca, potatoes, and other vegetables and fruits into ingredients and biomaterials for the food, beverage, paper and corrugating, brewing and other industries. Its product line includes animal feed products and edible corn oil. Its sweetener products include glucose syrups, high maltose syrup, high fructose corn syrup (HFCS), caramel color, dextrose, polyols, maltodextrins and glucose and syrup solids. Its starch-based products include both food-grade and industrial starches, and biomaterials. It also offers specialty ingredients.

Penford Corp Company Profile

Penford Corporation (Penford) is a developer, manufacturer and marketer of natural-based ingredient systems for food and industrial applications, including fuel grade ethanol. The Company has research and development capabilities, which are used in understanding the complex chemistry of carbohydrate-based materials and in developing applications to address customer needs. Penford operates in two business segments: Industrial Ingredients and Food Ingredients. Industrial Ingredients segment is a supplier of chemically modified starches to the paper and packaging industries. Industrial Ingredients also produces food grade corn starch for sale by the Company’s Food Ingredients business. Food Ingredients segment is a developer and manufacturer of specialty starches and dextrins to the food manufacturing and food service industries. This business is engaged is in leveraging the inherent characteristics from potato, corn, tapioca and rice to help improve its customers’ product performance.

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