Comparing Dean Foods (DF) & Kraft Heinz Foods (NYSE:HNZ)

Kraft Heinz Foods (NYSE: HNZ) and Dean Foods (NYSE:DF) are both food processing – nec companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, risk, earnings, analyst recommendations and profitability.

Profitability

This table compares Kraft Heinz Foods and Dean Foods’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Kraft Heinz Foods N/A N/A N/A
Dean Foods 0.53% 14.04% 3.35%

Valuation & Earnings

This table compares Kraft Heinz Foods and Dean Foods’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Kraft Heinz Foods N/A N/A N/A $3.26 5.71
Dean Foods $7.71 billion 0.13 $119.92 million $0.46 24.80

Dean Foods has higher revenue and earnings than Kraft Heinz Foods. Kraft Heinz Foods is trading at a lower price-to-earnings ratio than Dean Foods, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Kraft Heinz Foods and Dean Foods, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Kraft Heinz Foods 0 2 1 0 2.33
Dean Foods 2 6 3 0 2.09

Kraft Heinz Foods currently has a consensus price target of $17.65, suggesting a potential downside of 5.11%. Dean Foods has a consensus price target of $13.06, suggesting a potential upside of 14.42%. Given Dean Foods’ higher probable upside, analysts clearly believe Dean Foods is more favorable than Kraft Heinz Foods.

Institutional & Insider Ownership

94.2% of Dean Foods shares are held by institutional investors. 1.2% of Dean Foods shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Dividends

Dean Foods pays an annual dividend of $0.36 per share and has a dividend yield of 3.2%. Kraft Heinz Foods does not pay a dividend. Dean Foods pays out 78.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Summary

Dean Foods beats Kraft Heinz Foods on 9 of the 12 factors compared between the two stocks.

Kraft Heinz Foods Company Profile

H. J. Heinz Company, together with its subsidiaries, is engaged in manufacturing and marketing a range of food products throughout the world. The Company’s principal products include ketchup, condiments and sauces, frozen food, soups, beans and pasta meals, infant nutrition and other food products. The Company’s products are manufactured and packaged to provide wholesome foods for consumers, as well as foodservice and institutional customers. The Company manufactures and contracts for the manufacture of its products from a variety of raw food materials. The Company operates in five segments: North American Consumer Products, Europe, Asia/Pacific, U.S. Foodservice and Rest of World. The Company owns or leases office space, warehouses, distribution centers and research and other facilities throughout the world.

Dean Foods Company Profile

Dean Foods Company is a food and beverage company. The Company processes and distributes fluid milk, and other dairy and dairy case products in the United States. It is engaged in manufacturing, marketing, selling and distributing a range of branded and private label dairy and dairy case products. It offers branded and private label dairy case products, including fluid milk, ice cream, cultured dairy products, creamers, ice cream mix and other dairy products to retailers, distributors, foodservice outlets, educational institutions and governmental entities across the United States. It also offers juices, teas and bottled water. As of December 31, 2016, the Company had over 50 national, regional and local dairy brands, as well as private labels. As of December 31, 2016, the Company’s national, local and regional licensed brands included Alta Dena, Hygeia, PET, Arctic Splash, Jilbert, Pog, Barbers Dairy, Purity, Berkeley Farms, Land-O-Sun & design and ReadyLeaf, Broughton.

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