Contrasting Danone (OTCMKTS:DANOY) & Marzetti (NASDAQ:MZTI)

Marzetti (NASDAQ:MZTI) and Danone (OTCMKTS:DANOY) are both consumer staples companies, but which is the superior stock? We will contrast the two companies based on the strength of their institutional ownership, dividends, analyst recommendations, profitability, risk, valuation and earnings.

Valuation and Earnings

This table compares Marzetti and Danone”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Marzetti	$1.91 billion	2.41	$167.35 million	$6.16	27.10
Danone	$29.63 billion	2.06	$2.19 billion	N/A	N/A

Danone has higher revenue and earnings than Marzetti.

Profitability

This table compares Marzetti and Danone’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Marzetti	8.77%	18.86%	14.69%
Danone	N/A	N/A	N/A

Risk and Volatility

Marzetti has a beta of 0.42, indicating that its stock price is 58% less volatile than the S&P 500. Comparatively, Danone has a beta of 0.27, indicating that its stock price is 73% less volatile than the S&P 500.

Institutional and Insider Ownership

66.4% of Marzetti shares are held by institutional investors. Comparatively, 0.1% of Danone shares are held by institutional investors. 29.1% of Marzetti shares are held by company insiders. Comparatively, 1.0% of Danone shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Dividends

Marzetti pays an annual dividend of $4.00 per share and has a dividend yield of 2.4%. Danone pays an annual dividend of $0.34 per share and has a dividend yield of 1.9%. Marzetti pays out 64.9% of its earnings in the form of a dividend. Marzetti has increased its dividend for 62 consecutive years. Marzetti is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a breakdown of current ratings and target prices for Marzetti and Danone, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Marzetti	0	3	1	0	2.25
Danone	0	4	2	0	2.33

Marzetti presently has a consensus price target of $191.33, indicating a potential upside of 14.61%. Given Marzetti’s higher possible upside, equities research analysts plainly believe Marzetti is more favorable than Danone.

Summary

Marzetti beats Danone on 10 of the 15 factors compared between the two stocks.

About Marzetti

Lancaster Colony Corporation engages in the manufacturing and marketing of specialty food products for the retail and foodservice channels in the United States. It operates in two segments, Retail and Foodservice. The company offers frozen garlic bread under the New York BRAND Bakery; frozen Parkerhouse style yeast and dinner rolls under the Sister Schubert's brand; salad dressings under the Marzetti, Simply Dressed, Cardini's, and Girard's brands; vegetable and fruit dips under the Marzetti brand; croutons and salad toppings under the New York BRAND Bakery, Chatham Village, and Marzetti brands; and frozen pasta under the Marzetti Frozen Pasta brand. It also manufactures and sells other products to brand license agreements, including Olive Garden dressings, Buffalo Wild Wings sauces, and Chick-fil-A sauces. The company sells its products through sales personnel, food brokers, and distributors to retailers and restaurants. Lancaster Colony Corporation was incorporated in 1961 and is based in Westerville, Ohio.

About Danone

Danone S.A. operates in the food and beverage industry in Europe, Ukraine, North America, China, North Asia, the Oceania, Latin America, rest of Asia, Africa, Turkey, the Middle East, and the Commonwealth of Independent States. The company operates through Essential Dairy & Plant-Based, Specialized Nutrition, and Waters segments. It produces and distributes yogurts, dairy products, coffee creamers and drinks, beverages, plant-based products, ice creams, frozen desserts, and cheese products under the Actimel, Activia, Alpro, Aptamil, Danette, Danio, Danonino, evian, Nutricia, Nutrilon, Volvic, Danone, Light & Fit, Oikos, YoPRO, International Delight, SToK, Silk, Follow Your Heart, and So Delicious. The company also provides specialized nutrition, including formulas and complementary feeding for babies and young children; and special medical purposes food for children and adults under the Aptamil, Nutrilon, Gallia, Cow & Gate, Bebelac, and Blédina brands. In addition, it offers tube feeding products under the Nutrison name; and oral nutritional supplements under the Fortimel and NutriDrink names. Further, the company provides mineral waters from natural sources, waters infused with natural fruit extracts, fruit juices, and vitamins under the evian, Volvic, AQUA, Mizone, Bonafont, Salus, Hayat, Sirma, Font Vella, Lanjarón, and Zywiec Zdroj brands. It distributes its products through retail chains and traditional market outlets; convenience stores; hotels, restaurants, and coffee outlets; hospitals, clinics, and pharmacies; and e-commerce channels. The company was formerly known as Groupe Danone and changed its name to Danone S.A. in April 2009. Danone S.A. was incorporated in 1899 and is headquartered in Paris, France.