Contrasting General Mills (NYSE:GIS) & United Natural Foods (NYSE:UNFI)

General Mills (NYSE:GIS) and United Natural Foods (NYSE:UNFI) are both consumer staples companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, profitability, dividends, valuation, institutional ownership and earnings.

Risk & Volatility

General Mills has a beta of -0.03, indicating that its share price is 103% less volatile than the S&P 500. Comparatively, United Natural Foods has a beta of 0.81, indicating that its share price is 19% less volatile than the S&P 500.

Earnings & Valuation

This table compares General Mills and United Natural Foods”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
General Mills	$19.49 billion	0.88	$2.30 billion	$4.09	7.86
United Natural Foods	$31.78 billion	0.10	-$118.00 million	($1.30)	-40.83

General Mills has higher earnings, but lower revenue than United Natural Foods. United Natural Foods is trading at a lower price-to-earnings ratio than General Mills, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares General Mills and United Natural Foods’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
General Mills	12.05%	19.19%	5.48%
United Natural Foods	-0.25%	6.05%	1.27%

Insider and Institutional Ownership

75.7% of General Mills shares are held by institutional investors. Comparatively, 87.6% of United Natural Foods shares are held by institutional investors. 0.3% of General Mills shares are held by company insiders. Comparatively, 2.4% of United Natural Foods shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of recent recommendations and price targets for General Mills and United Natural Foods, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
General Mills	7	10	4	0	1.86
United Natural Foods	1	6	3	0	2.20

General Mills presently has a consensus target price of $40.06, indicating a potential upside of 24.55%. United Natural Foods has a consensus target price of $43.63, indicating a potential downside of 17.81%. Given General Mills’ higher probable upside, analysts clearly believe General Mills is more favorable than United Natural Foods.

Summary

General Mills beats United Natural Foods on 9 of the 14 factors compared between the two stocks.

About General Mills

General Mills, Inc. manufactures and markets branded consumer foods worldwide. The company operates through four segments: North America Retail; International; Pet; and North America Foodservice. It offers grain, ready-to-eat cereals, refrigerated yogurt, soup, meal kits, refrigerated and frozen dough products, dessert and baking mixes, bakery flour, frozen pizza and pizza snacks, snack bars, fruit and savory snacks, ice cream and frozen desserts, unbaked and fully baked frozen dough products, frozen hot snacks, ethnic meals, side dish mixes, frozen breakfast and entrees, nutrition bars, and frozen and shelf-stable vegetables. The company also manufactures and markets pet food products, including dog and cat food; and operates ice cream parlors. It markets its products under the Annie’s, Betty Crocker, Bisquick, Blue Buffalo, Bugles, Cascadian Farm, Cheerios, Chex, Cinnamon Toast Crunch, Cocoa Puffs, Cookie Crisp, Dunkaroos, Edgard & Cooper, Fiber One, Fruit by the Foot, Fruit Gushers, Fruit Roll-Ups, Gardetto’s, Gold Medal, Golden Grahams, Häagen-Dazs, Kitano, Kix, Lärabar, Latina, Lucky Charms, Muir Glen, Nature Valley, Nudges, Oatmeal Crisp, Old El Paso, Pillsbury, Progresso, Tastefuls, Total, Totino’s , Trix, True Chews, True Solutions, Wanchai Ferry, Wheaties, Wilderness, and Yoki brands. The company sells its products to grocery stores, mass merchandisers, membership stores, natural food chains, drug, dollar and discount chains, e-commerce retailers, commercial and noncommercial foodservice distributors and operators, restaurants, convenience stores, and pet specialty stores. General Mills, Inc. was founded in 1866 and is headquartered in Minneapolis, Minnesota.

About United Natural Foods

United Natural Foods, Inc., together with its subsidiaries, distributes natural, organic, specialty, produce, and conventional grocery and non-food products in the United States and Canada. It operates in two segments, Wholesale and Retail. The company offers grocery and general merchandise, produce, perishables and frozen foods, wellness and personal care items, and bulk and foodservice products. It also provides nuts, dried fruit, seeds, trail mixes, granola, natural and organic snack items, and confections under the Woodstock Farms Manufacturing name; organic, non-GMO project verified, and specialty food and non-food items under the Blue Marble brand name; pet food under the WILD HARVEST brand name; and various products under the ESSENTIAL EVERYDAY, SHOPPERS VALUE, Field Day, EQUALINE, CULINARY CIRCLE, and STONE RIDGE CREAMERY brand names. In addition, the company provides home, health and beauty care, and pharmacy products, as well as private label products through a network of Cub Foods and Shoppers retail grocery stores; and retail store support, pricing strategy, shelf and planogram management, advertising, couponing, ecommerce, consumer convenience, store design, equipment sourcing, electronic payments processing, network and data hosting, point-of-sale hardware and software, automation tools, sustainability, and administrative back-office solution services. Further, it offers consumer and trade marketing programs, and programs to support suppliers in understanding its markets. The company serves chains, independent retailers, and supernatural chains, as well as foodservice, ecommerce, conventional military business, and other sales customers. United Natural Foods, Inc. was founded in 1976 and is headquartered in Providence, Rhode Island.