Contrasting Nature’s Sunshine Products (NASDAQ:NATR) & Estee Lauder Companies (NYSE:EL)

Nature’s Sunshine Products (NASDAQ:NATR) and Estee Lauder Companies (NYSE:EL) are both consumer staples companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, profitability, earnings, analyst recommendations, valuation, risk and dividends.

Profitability

This table compares Nature’s Sunshine Products and Estee Lauder Companies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Nature’s Sunshine Products	3.05%	10.42%	6.64%
Estee Lauder Companies	2.41%	26.99%	5.42%

Valuation and Earnings

This table compares Nature’s Sunshine Products and Estee Lauder Companies”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Nature’s Sunshine Products	$480.29 million	0.37	$19.52 million	$0.82	12.59
Estee Lauder Companies	$15.28 billion	2.68	$182.00 million	$1.00	113.11

Estee Lauder Companies has higher revenue and earnings than Nature’s Sunshine Products. Nature’s Sunshine Products is trading at a lower price-to-earnings ratio than Estee Lauder Companies, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Nature’s Sunshine Products has a beta of 0.8, suggesting that its stock price is 20% less volatile than the S&P 500. Comparatively, Estee Lauder Companies has a beta of 1.23, suggesting that its stock price is 23% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Nature’s Sunshine Products and Estee Lauder Companies, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Nature’s Sunshine Products	0	1	2	0	2.67
Estee Lauder Companies	1	14	11	2	2.50

Nature’s Sunshine Products presently has a consensus price target of $25.00, suggesting a potential upside of 142.22%. Estee Lauder Companies has a consensus price target of $110.73, suggesting a potential downside of 2.10%. Given Nature’s Sunshine Products’ stronger consensus rating and higher probable upside, research analysts clearly believe Nature’s Sunshine Products is more favorable than Estee Lauder Companies.

Dividends

Nature’s Sunshine Products pays an annual dividend of $0.40 per share and has a dividend yield of 3.9%. Estee Lauder Companies pays an annual dividend of $1.40 per share and has a dividend yield of 1.2%. Nature’s Sunshine Products pays out 48.8% of its earnings in the form of a dividend. Estee Lauder Companies pays out 140.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Nature’s Sunshine Products is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider & Institutional Ownership

79.4% of Nature’s Sunshine Products shares are owned by institutional investors. Comparatively, 55.2% of Estee Lauder Companies shares are owned by institutional investors. 3.1% of Nature’s Sunshine Products shares are owned by insiders. Comparatively, 11.5% of Estee Lauder Companies shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Summary

Estee Lauder Companies beats Nature’s Sunshine Products on 10 of the 17 factors compared between the two stocks.

About Nature’s Sunshine Products

Nature’s Sunshine Products, Inc. develops and sells natural health and wellness products through direct selling, e-commerce and other distribution channels. Its product portfolio includes dietary supplements, herbal supplements, vitamins, minerals, essential oils, sports nutrition products and personal-care items. The company markets products primarily under the Nature’s Sunshine and Synergy WorldWide brands. Nature’s Sunshine focuses on nutritional and herbal wellness products, while Synergy offers supplements and performance-oriented nutrition products.

About Estee Lauder Companies

The Estée Lauder Companies Inc. is a global prestige beauty company founded in 1946 by Estée and Joseph Lauder. Based in New York City, it develops, markets and sells beauty products under a portfolio of brands, including Estée Lauder, Clinique, M·A·C, La Mer, Aveda and Jo Malone London. The company’s products span skin care, makeup, fragrance and hair care. It reaches consumers through department stores, specialty retailers, its own stores and websites, and other online and travel-retail channels.