Financial Analysis: Farmer Brothers (FARM) & Teavana Holdings (TEA)
Farmer Brothers (NASDAQ: FARM) and Teavana Holdings (NYSE:TEA) are both small-cap retail/wholesale companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, risk, analyst recommendations, earnings, dividends, profitability and institutional ownership.
This table compares Farmer Brothers and Teavana Holdings’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a breakdown of recent ratings for Farmer Brothers and Teavana Holdings, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Farmer Brothers currently has a consensus price target of $38.50, indicating a potential upside of 14.93%.
Insider & Institutional Ownership
53.5% of Farmer Brothers shares are owned by institutional investors. 9.3% of Farmer Brothers shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
Earnings & Valuation
This table compares Farmer Brothers and Teavana Holdings’ top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Farmer Brothers||$541.50 million||1.04||$24.40 million||$1.31||25.57|
Farmer Brothers has higher revenue and earnings than Teavana Holdings. Teavana Holdings is trading at a lower price-to-earnings ratio than Farmer Brothers, indicating that it is currently the more affordable of the two stocks.
Farmer Brothers beats Teavana Holdings on 8 of the 8 factors compared between the two stocks.
About Farmer Brothers
Farmer Bros. Co. is a national coffee roaster, wholesaler and distributor of coffee, tea and culinary products. The Company offers private brand and consumer-branded coffee products to small independent restaurants and foodservice operators, and institutional buyers. Its product line includes organic, Direct Trade, Direct Trade Verified Sustainable (DTVS) coffees and other coffees, iced and hot teas, cappuccino, spices, and baking/biscuit mixes. Its primary brands include Farmer Brothers, Artisan Collection by Farmer Brothers, Superior and Metropolitan. Its Artisan coffee products include Direct Trade, Fair Trade Certified, Rainforest Alliance Certified organic blends. It sells whole bean and roast and ground flavored and unflavored coffee products under the Un Momento, Collaborative Coffee, Cain’s and McGarvey brands at retail. Its roast and ground coffee products are sold in traditional packaging, including bags and fractional packages, as well as single-serve packaging.
About Teavana Holdings
Teavana Holdings, Inc. (Teavana) is a specialty retailer of loose-leaf teas, authentic artisanal teawares and other tea-related merchandise. As of January 30, 2011, the Company had more than 100 varieties of loose-leaf teas, teawares, such as handcrafted cast-iron, clay and ceramic teapots and other tea-related merchandise. The Company offers its loose-leaf teas and tea-related merchandise through its United States retail store base, online platform, and international and domestic franchise stores. As of January 30, 2011, the Company offered its products through 146 company-owned stores in 34 states and 15 franchised stores primarily in Mexico. In June 2012, the Company acquired Teaopia Limited. In December 2012, Starbucks Coffee Company acquired Teavana.
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