Kellogg (NYSE: K) is one of 50 public companies in the “Food Processing” industry, but how does it contrast to its peers? We will compare Kellogg to similar businesses based on the strength of its valuation, analyst recommendations, earnings, dividends, risk, profitability and institutional ownership.

Institutional & Insider Ownership

85.4% of Kellogg shares are held by institutional investors. Comparatively, 63.5% of shares of all “Food Processing” companies are held by institutional investors. 1.3% of Kellogg shares are held by insiders. Comparatively, 12.2% of shares of all “Food Processing” companies are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares Kellogg and its peers revenue, earnings per share (EPS) and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Kellogg $12.79 billion $2.27 billion 28.22
Kellogg Competitors $8.38 billion $1.05 billion 22.45

Kellogg has higher revenue and earnings than its peers. Kellogg is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Analyst Ratings

This is a summary of recent ratings for Kellogg and its peers, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Kellogg 1 7 1 0 2.00
Kellogg Competitors 360 1676 1911 62 2.42

Kellogg presently has a consensus target price of $74.78, indicating a potential upside of 19.89%. As a group, “Food Processing” companies have a potential upside of 0.29%. Given Kellogg’s higher possible upside, equities analysts clearly believe Kellogg is more favorable than its peers.

Volatility and Risk

Kellogg has a beta of 0.48, indicating that its share price is 52% less volatile than the S&P 500. Comparatively, Kellogg’s peers have a beta of 0.72, indicating that their average share price is 28% less volatile than the S&P 500.

Profitability

This table compares Kellogg and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Kellogg 6.12% 70.22% 9.15%
Kellogg Competitors 4.08% 11.36% 4.77%

Dividends

Kellogg pays an annual dividend of $2.16 per share and has a dividend yield of 3.5%. Kellogg pays out 97.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Food Processing” companies pay a dividend yield of 2.6% and pay out 60.1% of their earnings in the form of a dividend. Kellogg has raised its dividend for 12 consecutive years.

Summary

Kellogg beats its peers on 8 of the 15 factors compared.

About Kellogg

Kellogg Company is a manufacturer and marketer of ready-to-eat cereal and convenience foods. The Company’s principal products are ready-to-eat cereals and convenience foods, such as cookies, crackers, savory snacks, toaster pastries, cereal bars, fruit-flavored snacks, frozen waffles and veggie foods. Its segments include U.S. Morning Foods, which includes cereal, toaster pastries, health and wellness bars, and beverages; U.S. Snacks, which includes cookies, crackers, cereal bars, savory snacks and fruit-flavored snacks; U.S. Specialty, which represents food away from home channels, including food service, convenience, vending, Girl Scouts and food manufacturing; North America Other, which includes the U.S. Frozen, Kashi and Canada operating segments; Europe, which consists of European countries; Latin America, which consists of Central and South America and includes Mexico, and Asia Pacific, which consists of Sub-Saharan Africa, Australia and other Asian and Pacific markets.

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