Analyzing Kerry Group (OTCMKTS:KRYAY) and Lamb Weston (NYSE:LW)

Lamb Weston (NYSE:LW) and Kerry Group (OTCMKTS:KRYAY) are both consumer staples companies, but which is the better business? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, earnings, dividends, risk, valuation and profitability.

Dividends

Lamb Weston pays an annual dividend of $1.48 per share and has a dividend yield of 3.3%. Kerry Group pays an annual dividend of $0.69 per share and has a dividend yield of 0.8%. Lamb Weston pays out 53.2% of its earnings in the form of a dividend. Lamb Weston has raised its dividend for 7 consecutive years. Lamb Weston is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Lamb Weston and Kerry Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lamb Weston	1	9	3	0	2.15
Kerry Group	0	1	2	0	2.67

Lamb Weston currently has a consensus price target of $53.00, suggesting a potential upside of 17.86%. Given Lamb Weston’s higher probable upside, equities research analysts plainly believe Lamb Weston is more favorable than Kerry Group.

Profitability

This table compares Lamb Weston and Kerry Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Lamb Weston	6.06%	27.71%	6.52%
Kerry Group	N/A	N/A	N/A

Volatility and Risk

Lamb Weston has a beta of 0.45, meaning that its share price is 55% less volatile than the S&P 500. Comparatively, Kerry Group has a beta of 0.63, meaning that its share price is 37% less volatile than the S&P 500.

Earnings and Valuation

This table compares Lamb Weston and Kerry Group”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Lamb Weston	$6.45 billion	0.97	$357.20 million	$2.78	16.18
Kerry Group	$7.50 billion	1.88	$728.69 million	N/A	N/A

Kerry Group has higher revenue and earnings than Lamb Weston.

Institutional and Insider Ownership

89.6% of Lamb Weston shares are held by institutional investors. Comparatively, 0.2% of Kerry Group shares are held by institutional investors. 0.3% of Lamb Weston shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

Lamb Weston beats Kerry Group on 9 of the 15 factors compared between the two stocks.

About Lamb Weston

Lamb Weston Holdings, Inc. produces, distributes, and markets frozen potato products worldwide. The company operates through four segments: Global, Foodservice, Retail, and Other. It offers frozen potatoes, commercial ingredients, and appetizers under the Lamb Weston brand, as well as under various customer labels. The company also provides its products under its owned or licensed brands, such as Grown in Idaho and Alexia, and other licensed brands, as well as under retailers' own brands. In addition, it engages in the vegetable and dairy businesses. The company sells its products through a network of internal sales personnel and independent brokers, agents, and distributors to chain restaurants, wholesale, grocery, mass merchants, club and specialty retailers, businesses, educational institutions, independent restaurants, regional chain restaurants, and convenience stores. Lamb Weston Holdings, Inc. was incorporated in 1950 and is headquartered in Eagle, Idaho.

About Kerry Group

Kerry Group plc, together with its subsidiaries, provides taste and nutrition solutions. The company operates in two segments, Taste & Nutrition, and Dairy Ireland. The Taste & Nutrition segment offers taste and nutrition solutions for the food, beverage, and pharmaceutical markets. The Dairy Ireland segment provides value-add dairy ingredients and consumer products, including functional proteins and nutritional bases. It operates in Ireland, rest of Europe, the Americas, the Asia Pacific, the Middle East, and Africa. Kerry Group plc was founded in 1972 and is headquartered in Tralee, Ireland.