Kellogg (K) vs. Dean Foods (DF) Head-To-Head Analysis
Kellogg (NYSE: K) and Dean Foods (NYSE:DF) are both consumer staples companies, but which is the better stock? We will compare the two companies based on the strength of their analyst recommendations, dividends, earnings, valuation, profitability, risk and institutional ownership.
Kellogg pays an annual dividend of $2.08 per share and has a dividend yield of 3.0%. Dean Foods pays an annual dividend of $0.36 per share and has a dividend yield of 2.9%. Kellogg pays out 94.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Dean Foods pays out 60.0% of its earnings in the form of a dividend. Kellogg has raised its dividend for 12 consecutive years. Kellogg is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Insider & Institutional Ownership
83.5% of Kellogg shares are owned by institutional investors. 1.3% of Kellogg shares are owned by company insiders. Comparatively, 1.2% of Dean Foods shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
This is a breakdown of current ratings for Kellogg and Dean Foods, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Kellogg presently has a consensus target price of $74.78, indicating a potential upside of 8.67%. Dean Foods has a consensus target price of $14.67, indicating a potential upside of 19.83%. Given Dean Foods’ higher probable upside, analysts clearly believe Dean Foods is more favorable than Kellogg.
Risk and Volatility
Kellogg has a beta of 0.5, suggesting that its share price is 50% less volatile than the S&P 500. Comparatively, Dean Foods has a beta of 0.54, suggesting that its share price is 46% less volatile than the S&P 500.
This table compares Kellogg and Dean Foods’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Earnings and Valuation
This table compares Kellogg and Dean Foods’ revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Kellogg||$12.79 billion||1.88||$2.27 billion||$2.21||31.14|
|Dean Foods||$7.91 billion||0.14||$376.23 million||$0.60||20.40|
Kellogg has higher revenue and earnings than Dean Foods. Dean Foods is trading at a lower price-to-earnings ratio than Kellogg, indicating that it is currently the more affordable of the two stocks.
Kellogg beats Dean Foods on 13 of the 17 factors compared between the two stocks.
Kellogg Company is a manufacturer and marketer of ready-to-eat cereal and convenience foods. The Company’s principal products are ready-to-eat cereals and convenience foods, such as cookies, crackers, savory snacks, toaster pastries, cereal bars, fruit-flavored snacks, frozen waffles and veggie foods. Its segments include U.S. Morning Foods, which includes cereal, toaster pastries, health and wellness bars, and beverages; U.S. Snacks, which includes cookies, crackers, cereal bars, savory snacks and fruit-flavored snacks; U.S. Specialty, which represents food away from home channels, including food service, convenience, vending, Girl Scouts and food manufacturing; North America Other, which includes the U.S. Frozen, Kashi and Canada operating segments; Europe, which consists of European countries; Latin America, which consists of Central and South America and includes Mexico, and Asia Pacific, which consists of Sub-Saharan Africa, Australia and other Asian and Pacific markets.
About Dean Foods
Dean Foods Company is a food and beverage company. The Company processes and distributes fluid milk, and other dairy and dairy case products in the United States. It is engaged in manufacturing, marketing, selling and distributing a range of branded and private label dairy and dairy case products. It offers branded and private label dairy case products, including fluid milk, ice cream, cultured dairy products, creamers, ice cream mix and other dairy products to retailers, distributors, foodservice outlets, educational institutions and governmental entities across the United States. It also offers juices, teas and bottled water. As of December 31, 2016, the Company had over 50 national, regional and local dairy brands, as well as private labels. As of December 31, 2016, the Company’s national, local and regional licensed brands included Alta Dena, Hygeia, PET, Arctic Splash, Jilbert, Pog, Barbers Dairy, Purity, Berkeley Farms, Land-O-Sun & design and ReadyLeaf, Broughton.
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