Krispy Kreme Doughnuts (NYSE: KKD) and Sprouts Farmers Market (NASDAQ:SFM) are both non-cyclical consumer goods & services companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, analyst recommendations, institutional ownership, risk, valuation, profitability and dividends.
Risk & Volatility
Krispy Kreme Doughnuts has a beta of 1.52, suggesting that its stock price is 52% more volatile than the S&P 500. Comparatively, Sprouts Farmers Market has a beta of 0.84, suggesting that its stock price is 16% less volatile than the S&P 500.
Insider and Institutional Ownership
91.0% of Sprouts Farmers Market shares are held by institutional investors. 2.6% of Sprouts Farmers Market shares are held 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.
This table compares Krispy Kreme Doughnuts and Sprouts Farmers Market’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Krispy Kreme Doughnuts||6.90%||15.58%||11.41%|
|Sprouts Farmers Market||3.40%||21.81%||9.07%|
Earnings and Valuation
This table compares Krispy Kreme Doughnuts and Sprouts Farmers Market’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Krispy Kreme Doughnuts||N/A||N/A||N/A||$0.47||44.68|
|Sprouts Farmers Market||$4.66 billion||0.72||$158.44 million||$1.14||22.13|
Sprouts Farmers Market has higher revenue and earnings than Krispy Kreme Doughnuts. Sprouts Farmers Market is trading at a lower price-to-earnings ratio than Krispy Kreme Doughnuts, indicating that it is currently the more affordable of the two stocks.
This is a summary of recent recommendations and price targets for Krispy Kreme Doughnuts and Sprouts Farmers Market, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Krispy Kreme Doughnuts||0||0||0||0||N/A|
|Sprouts Farmers Market||2||7||12||0||2.48|
Sprouts Farmers Market has a consensus target price of $26.94, indicating a potential upside of 6.78%. Given Sprouts Farmers Market’s higher possible upside, analysts clearly believe Sprouts Farmers Market is more favorable than Krispy Kreme Doughnuts.
Sprouts Farmers Market beats Krispy Kreme Doughnuts on 7 of the 11 factors compared between the two stocks.
About Krispy Kreme Doughnuts
Krispy Kreme Doughnuts, Inc. is a retailer and wholesaler of doughnuts, complementary beverages, and treats and packaged sweets. The Company’s principal business includes owning and franchising Krispy Kreme stores, at which a range of doughnuts, including the Company’s Original Glazed doughnut, together with complementary products, including an array of coffees and other beverages. The Company operates through four business segments: Company Stores, Domestic Franchise, International Franchise and KK Supply Chain. The Company Stores segment includes the doughnut shops operated by the Company. The Domestic Franchise segment consists of the Company’s domestic store franchise operations and the licensing of Krispy Kreme products domestically. The International Franchise segment consists of the Company’s international store franchise operations. The KK Supply Chain segment produces doughnut mixes and manufactures doughnut-making equipment.
About Sprouts Farmers Market
Sprouts Farmers Market, Inc. is a food retailer. The Company operates as a grocery store that offers fresh, natural and organic food that includes fresh produce, bulk foods, vitamins and supplements, packaged groceries, meat and seafood, deli, baked goods, dairy products, frozen foods, body care and natural household items catering to consumers’ interest in health and wellness. As of February 23, 2017, the Company operated 256 stores in 14 states. The Company categorizes the varieties of products it sells as perishable and non-perishable. The perishable product categories include produce, meat, seafood, deli and bakery. Its non-perishable product categories include grocery, vitamins and supplements, bulk items, dairy and dairy alternatives, frozen foods, beer and wine, and natural health and body care.
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