Head-To-Head Review: Pigeon (OTCMKTS:PGENY) versus Central Garden & Pet (NASDAQ:CENTA)

Central Garden & Pet (NASDAQ:CENTA) and Pigeon (OTCMKTS:PGENY) are both small-cap consumer discretionary companies, but which is the superior stock? We will contrast the two companies based on the strength of their earnings, analyst recommendations, institutional ownership, profitability, valuation, dividends and risk.

Profitability

This table compares Central Garden & Pet and Pigeon’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Central Garden & Pet	4.44%	10.77%	4.65%
Pigeon	8.82%	11.95%	9.29%

Volatility & Risk

Central Garden & Pet has a beta of 0.63, suggesting that its share price is 37% less volatile than the S&P 500. Comparatively, Pigeon has a beta of 0.11, suggesting that its share price is 89% less volatile than the S&P 500.

Insider and Institutional Ownership

50.8% of Central Garden & Pet shares are held by institutional investors. 20.3% of Central Garden & Pet shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Central Garden & Pet and Pigeon, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Central Garden & Pet	0	5	1	0	2.17
Pigeon	0	0	0	0	0.00

Central Garden & Pet currently has a consensus target price of $38.33, indicating a potential upside of 33.71%. Given Central Garden & Pet’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Central Garden & Pet is more favorable than Pigeon.

Valuation and Earnings

This table compares Central Garden & Pet and Pigeon”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Central Garden & Pet	$3.20 billion	0.56	$107.98 million	$2.20	13.03
Pigeon	$688.99 million	1.81	$55.26 million	$0.13	20.00

Central Garden & Pet has higher revenue and earnings than Pigeon. Central Garden & Pet is trading at a lower price-to-earnings ratio than Pigeon, indicating that it is currently the more affordable of the two stocks.

Summary

Central Garden & Pet beats Pigeon on 9 of the 14 factors compared between the two stocks.

About Central Garden & Pet

Central Garden & Pet Co. engages in the production and distribution of branded and private label products for the lawn, garden, and pet supplies markets. It operates through the Pet and Garden segments. The Pet segment focuses on dog and cat supplies such as dog treats and chews, toys, pet beds and containment, grooming products, waste management and training pads, supplies for aquatics, small animals, reptiles and pet birds including toys, cages and habitats, bedding, food and supplements, products for equine and livestock, animal and household health and insect control products, live fish, and small animals, as well as outdoor cushions. The Garden segment includes lawn and garden consumables such as grass, vegetable, flower and herb seed, wild bird feed, bird houses and other birding accessories, weed, grass, and other herbicides, insecticide and pesticide products, fertilizers, and live plants. The company was founded by William E. Brown in 1980 and is headquartered in Walnut Creek, CA.

About Pigeon

Pigeon Corporation, together with its subsidiaries, engages in the manufacture, sale, import, and export of baby and child-care products, maternity items, women’s care products, home healthcare products, and nursing care products in Japan and internationally. The company operates in four segments: Japan Business, China Business, Singapore Business, and Lansinoh Business. The company is involved in the provision of baby and mother care products, such as nursing bottles and nipples, toiletries, breast pads, breast pumps, nipple care products, breast milk storage bags, and breastfeeding-related products under Pigeon and Lansinoh brands. It also offers non-woven products, baby strollers, aging-prevention products, wet wipes, skincare products, cleaning and disinfecting products, and elder care products and services. In addition, the company provides child-minding and daycare services, in-home nursing care support services, outpatient care facility services, operation of in-company childcare facilities, daycare services, event childcare services, babysitter dispatch services, preschool education services, and at-home elder care services. The company was formerly known as Pigeon Honyuki Honpo Corporation and changed its name to Pigeon Corporation in 1966. Pigeon Corporation was founded in 1949 and is headquartered in Tokyo, Japan.