Analyzing Heineken (OTCMKTS:HEINY) and Diageo (NYSE:DEO)

Diageo (NYSE:DEO) and Heineken (OTCMKTS:HEINY) are both large-cap consumer staples companies, but which is the better business? We will compare the two businesses based on the strength of their institutional ownership, earnings, risk, profitability, analyst recommendations, valuation and dividends.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Diageo and Heineken, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Diageo	2	5	6	0	2.31
Heineken	0	7	1	1	2.33

Diageo currently has a consensus price target of $106.25, suggesting a potential upside of 20.68%. Given Diageo’s higher possible upside, equities analysts clearly believe Diageo is more favorable than Heineken.

Risk and Volatility

Diageo has a beta of 0.54, meaning that its share price is 46% less volatile than the S&P 500. Comparatively, Heineken has a beta of 0.37, meaning that its share price is 63% less volatile than the S&P 500.

Valuation and Earnings

This table compares Diageo and Heineken”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Diageo	$20.25 billion	2.42	$2.35 billion	N/A	N/A
Heineken	$38.75 billion	1.33	$2.13 billion	N/A	N/A

Diageo has higher earnings, but lower revenue than Heineken.

Dividends

Diageo pays an annual dividend of $1.52 per share and has a dividend yield of 1.7%. Heineken pays an annual dividend of $1.02 per share and has a dividend yield of 2.2%.

Profitability

This table compares Diageo and Heineken’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Diageo	N/A	N/A	N/A
Heineken	N/A	N/A	N/A

Insider & Institutional Ownership

9.0% of Diageo shares are owned by institutional investors. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Summary

Diageo beats Heineken on 6 of the 10 factors compared between the two stocks.

About Diageo

Diageo plc, together with its subsidiaries, engages in the production, marketing, and sale of alcoholic beverages. The company offers scotch, gin, vodka, rum, raki, liqueur, wine, tequila, Chinese white spirits, cachaça, and brandy, as well as beer, including cider and flavored malt beverages. It also provides Chinese, Canadian, Irish, American, and Indian-Made Foreign Liquor whiskies, as well as flavored malt beverages, ready to drink, and non-alcoholic products. The company provides its products under the Johnnie Walker, Crown Royal, J&B, Buchanan’s, Smirnoff, Cîroc, Ketel One, Captain Morgan, Baileys, Don Julio, Casamigos, Tanqueray, Guinness, Shui Jing Fang, Yenì, McDowell’s, Don Papa, Aviation American, Seagram, Seagram’s 7 Crown, Zacapa, Black Dog, Black & White, Signature, Royal Challenge, Godawan, Antiquity, Gordon’s, Old Parr, Windsor, Bundaberg, Ypióca, Bulleit, and Bell’s brand names. It operates in the United States, the United Kingdom, Türkiye, Australia, Korea, India, Greater China, Brazil, Mexico, South Africa, Nigeria, and internationally. The company was incorporated in 1886 and is headquartered in London, the United Kingdom.

About Heineken

Heineken N.V. brews and sells beer and cider in the Americas, Europe, Africa, the Middle East, Eastern Europe, and the Asia Pacific. The company provides soft drinks and water. It offers its beers under the Heineken, Heineken Light, Orchard Thieves, Orchard Thieves Light, Birra Moretti, Coors, Murphy's and Beamish Stouts, Desperados, Tiger, Sol, and Foster's brand, as well as under regional and local brands. The company offers its products to retailers, wholesalers, cafes, bars, pubs, hotels, and restaurants. Heineken N.V. was incorporated in 1864 and is based in Amsterdam, the Netherlands. The company operates as a subsidiary of Heineken Holding N.V.