Smithfield Foods (NASDAQ:SFD) & Premier Foods (OTCMKTS:PFODF) Head to Head Review

Premier Foods (OTCMKTS:PFODF) and Smithfield Foods (NASDAQ:SFD) are both consumer staples companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, analyst recommendations, profitability, dividends, earnings, risk and institutional ownership.

Institutional and Insider Ownership

32.0% of Premier Foods shares are owned by institutional investors. 1.8% of Smithfield Foods shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Premier Foods and Smithfield Foods’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Premier Foods	N/A	N/A	N/A
Smithfield Foods	6.48%	15.54%	8.76%

Analyst Recommendations

This is a breakdown of current ratings for Premier Foods and Smithfield Foods, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Premier Foods	0	1	1	0	2.50
Smithfield Foods	0	1	5	0	2.83

Smithfield Foods has a consensus price target of $30.88, indicating a potential upside of 21.52%. Given Smithfield Foods’ stronger consensus rating and higher probable upside, analysts plainly believe Smithfield Foods is more favorable than Premier Foods.

Valuation & Earnings

This table compares Premier Foods and Smithfield Foods”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Premier Foods	N/A	N/A	N/A	($0.72)	-3.54
Smithfield Foods	$15.53 billion	0.64	$987.00 million	$2.56	9.93

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

Summary

Smithfield Foods beats Premier Foods on 10 of the 11 factors compared between the two stocks.

About Premier Foods

Premier Foods plc, together with its subsidiaries, manufactures and distributes branded and own label food products in the United Kingdom, other European countries, and internationally. The company operates through Grocery, Sweet Treats, and international segments. It offers a portfolio of product categories, including flavorings and seasonings under the Bisto, OXO, Paxo, and Saxa brands; cooking sauces and accompaniments under the Sharwood's, Loyd Grossman, Spice Tailor and Homepride brands; quick meals, snacks, and soups under the Batchelors and Smash brands; ambient desserts under the Ambrosia, Bird's, and Angel Delight brands; and ambient cakes under the Mr Kipling and Cadbury brands. The company also provides dumplings under the Atora brand name; plain flour under the Be-Ro brand; dried milk under the Marvel brand name; plain and self-raising flour under the McDougalls brand; and plant based food under the Plantastic brand name. It offers its products through supermarkets, discounters, convenience stores, and wholesale and food service facilities, as well as through e-commerce channels. The company was founded in 1975 and is headquartered in Saint Albans, the United Kingdom.

About Smithfield Foods

Smithfield Foods, Inc. produces and markets a variety of fresh meat and packaged meats products both domestically and internationally. The Company operates in four segments: Pork, Hog Production, International and Corporate, each of which consists of a number of subsidiaries, joint ventures and other investments. The Pork segment consists mainly of its three wholly owned United States fresh pork and packaged meats subsidiaries: The Smithfield Packing Company, Inc. (Smithfield Packing), Farmland Foods, Inc. (Farmland Foods) and John Morrell Food Group (John Morrell). The Hog Production segment consists of the Company’s hog production operations located in the United States. On September 2012 (fiscal 2013), the Company acquired a 70% controlling interest in American Skin Food Group, LLC. Effective September 26, 2013, Shuanghui International Holdings Ltd merged with Smithfield Foods Inc, a producer and wholesaler of pork meat products.