Head to Head Review: 22nd Century Group (NASDAQ:XXII) versus Universal (NYSE:UVV)

Universal (NYSE:UVV) and 22nd Century Group (NASDAQ:XXII) are both small-cap consumer staples companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, profitability, earnings, analyst recommendations, valuation, institutional ownership and risk.

Earnings and Valuation

This table compares Universal and 22nd Century Group”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Universal	$2.92 billion	0.38	$32.64 million	$0.77	58.30
22nd Century Group	$17.59 million	0.12	-$5.05 million	($4,365.27)	-0.00

Universal has higher revenue and earnings than 22nd Century Group. 22nd Century Group is trading at a lower price-to-earnings ratio than Universal, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Universal has a beta of 0.6, indicating that its stock price is 40% less volatile than the S&P 500. Comparatively, 22nd Century Group has a beta of 0.65, indicating that its stock price is 35% less volatile than the S&P 500.

Institutional & Insider Ownership

81.0% of Universal shares are held by institutional investors. Comparatively, 18.1% of 22nd Century Group shares are held by institutional investors. 2.2% of Universal shares are held by company insiders. Comparatively, 0.0% of 22nd Century Group 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.

Profitability

This table compares Universal and 22nd Century Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Universal	0.67%	3.50%	1.74%
22nd Century Group	-25.34%	-84.37%	-45.90%

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Universal and 22nd Century Group, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Universal	0	2	0	0	2.00
22nd Century Group	1	0	0	0	1.00

Summary

Universal beats 22nd Century Group on 11 of the 12 factors compared between the two stocks.

About Universal

Universal Corporation processes and supplies leaf tobacco and plant-based ingredients worldwide. The company operates through two segments, Tobacco Operations; and Ingredients Operations. It is involved in the procuring, financing, processing, packing, storing, and shipping leaf tobacco for sale to manufacturers of consumer tobacco products. The company contracts, purchases, processes, and sells flue-cured, burley, and oriental tobaccos that are primarily used in the manufacture of cigarettes; and dark air-cured tobaccos principally used in the manufacture of cigars, natural wrapped cigars and cigarillos, smokeless, and pipe tobacco products. It also provides value-added services, including blending, chemical, and physical testing of tobacco; service cutting for various manufacturers; manufacturing reconstituted leaf tobacco; just-in-time inventory management services; electronic nicotine delivery systems; and smoke testing services for customers. In addition, the company offers testing services for crop protection agents and tobacco constituents in seed, leaf, and finished products, including e-cigarette liquids and vapors; and analytical services that include chemical compound testing in finished tobacco products and mainstream smoke. Further, it provides a various value-added manufacturing processes to produce specialty vegetable and fruit-based ingredients, as well as botanical extracts and flavorings for human and pet food markets; and recycles waste materials from tobacco production. Universal Corporation was founded in 1886 and is headquartered in Richmond, Virginia.

About 22nd Century Group

22nd Century Group, Inc., a tobacco products company, engages in the sale and distribution of its own proprietary new reduced nicotine tobacco products. The company offers reduced nicotine content tobacco plants and very low nicotine combustible cigarette products. It also provides contract manufacturing services for conventional combustible tobacco products for third-party brands. The company was founded in 1998 and is headquartered in Mocksville, North Carolina.