Reynolds Consumer Products (NASDAQ:REYN) versus Lifetime Brands (NASDAQ:LCUT) Critical Review

Lifetime Brands (NASDAQ:LCUT) and Reynolds Consumer Products (NASDAQ:REYN) are both consumer discretionary companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, valuation, institutional ownership, risk, profitability, dividends and earnings.

Risk and Volatility

Lifetime Brands has a beta of 0.92, suggesting that its stock price is 8% less volatile than the S&P 500. Comparatively, Reynolds Consumer Products has a beta of 0.57, suggesting that its stock price is 43% less volatile than the S&P 500.

Institutional and Insider Ownership

40.6% of Lifetime Brands shares are held by institutional investors. Comparatively, 26.8% of Reynolds Consumer Products shares are held by institutional investors. 44.4% of Lifetime Brands shares are held by insiders. Comparatively, 0.4% of Reynolds Consumer Products shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Dividends

Lifetime Brands pays an annual dividend of $0.17 per share and has a dividend yield of 2.0%. Reynolds Consumer Products pays an annual dividend of $0.92 per share and has a dividend yield of 4.3%. Lifetime Brands pays out -13.4% of its earnings in the form of a dividend. Reynolds Consumer Products pays out 58.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Analyst Ratings

This is a breakdown of current ratings and price targets for Lifetime Brands and Reynolds Consumer Products, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lifetime Brands	1	1	1	1	2.50
Reynolds Consumer Products	0	7	0	0	2.00

Lifetime Brands presently has a consensus target price of $7.00, indicating a potential downside of 17.26%. Reynolds Consumer Products has a consensus target price of $23.60, indicating a potential upside of 9.16%. Given Reynolds Consumer Products’ higher possible upside, analysts clearly believe Reynolds Consumer Products is more favorable than Lifetime Brands.

Valuation & Earnings

This table compares Lifetime Brands and Reynolds Consumer Products”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Lifetime Brands	$647.93 million	0.30	-$26.94 million	($1.27)	-6.66
Reynolds Consumer Products	$3.72 billion	1.22	$301.00 million	$1.57	13.77

Reynolds Consumer Products has higher revenue and earnings than Lifetime Brands. Lifetime Brands is trading at a lower price-to-earnings ratio than Reynolds Consumer Products, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Lifetime Brands and Reynolds Consumer Products’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Lifetime Brands	-4.22%	8.01%	2.76%
Reynolds Consumer Products	8.70%	16.05%	7.24%

Summary

Reynolds Consumer Products beats Lifetime Brands on 10 of the 17 factors compared between the two stocks.

About Lifetime Brands

Lifetime Brands, Inc. designs, sources, and sells branded kitchenware, tableware, and other products for use in the home in the worldwide. The company provides kitchenware products, including kitchen tools and gadgets, cutlery, kitchen scales, thermometers, cutting boards, shears, cookware, pantryware, spice racks, and bakeware; and tableware products comprising dinnerware, stemware, flatware, and giftware. It also provides home solutions, such as thermal beverageware, bath scales, weather and outdoor household, food storage, neoprene travel, and home décor products. The company owns or licenses various brands, including the Farberware, Mikasa, Taylor, KitchenAid, Pfaltzgraff, BUILT NY, Rabbit, Kamenstein, S’well, and Fred & Friends. It serves mass market merchants, specialty stores, department stores, warehouse clubs, grocery stores, off-price retailers, food service distributors, food and beverage outlets, and e-commerce. The company sells its products directly, as well as through its retail websites. Lifetime Brands, Inc. was founded in 1945 and is headquartered in Garden City, New York.

About Reynolds Consumer Products

Reynolds Consumer Products Inc. produces and sells products in cooking, waste and storage, and tableware product categories in the United States and internationally. It operates through four segments: Reynolds Cooking & Baking, Hefty Waste & Storage, Hefty Tableware, and Presto Products. The Reynolds Cooking & Baking segment produces aluminum foil, disposable aluminum pans, parchment paper, freezer paper, wax paper, butcher paper, plastic wrap, baking cups, oven bags, and slow cooker liners under the Reynolds Wrap, Reynolds KITCHENS, and EZ Foil brands in the United States, as well as under the ALCAN brand in Canada and under the Diamond brand internationally. The Hefty Waste & Storage segment offers trash bags under the Hefty Ultra Strong and Hefty Strong brands; and food storage bags under the Hefty and Baggies brands. This segment also provides a suite of products, including compostable bags, bags made from recycled materials, and the orange bags. The Hefty Tableware segment offers disposable and compostable plates, bowls, platters, cups, and cutlery under the Hefty brand. The Presto Products segment primarily sells store brand products in food storage bags, trash bags, reusable storage containers, and plastic wrap categories. It offers both branded and store brand products to grocery stores, mass merchants, warehouse clubs, discount chains, dollar stores, drug stores, home improvement stores, military outlets, and eCommerce retailers. The company was founded in 1947 and is headquartered in Lake Forest, Illinois. Reynolds Consumer Products Inc. is a subsidiary of Packaging Finance Limited.