Dean Foods (NYSE: DF) and Campbell Soup (NYSE:CPB) are both consumer staples companies, but which is the superior business? We will compare the two businesses based on the strength of their profitability, dividends, institutional ownership, analyst recommendations, valuation, earnings and risk.

Dividends

Dean Foods pays an annual dividend of $0.36 per share and has a dividend yield of 3.4%. Campbell Soup pays an annual dividend of $1.40 per share and has a dividend yield of 3.1%. Dean Foods pays out 60.0% of its earnings in the form of a dividend. Campbell Soup pays out 48.4% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Profitability

This table compares Dean Foods and Campbell Soup’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Dean Foods 0.70% 16.63% 3.92%
Campbell Soup 11.24% 59.84% 12.07%

Institutional & Insider Ownership

44.3% of Campbell Soup shares are owned by institutional investors. 1.2% of Dean Foods shares are owned by company insiders. Comparatively, 37.3% of Campbell Soup shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares Dean Foods and Campbell Soup’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Dean Foods $7.91 billion 0.12 $376.23 million $0.60 17.50
Campbell Soup $7.89 billion 1.73 $1.99 billion $2.89 15.62

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

Risk & Volatility

Dean Foods has a beta of 0.51, meaning that its share price is 49% less volatile than the S&P 500. Comparatively, Campbell Soup has a beta of 0.36, meaning that its share price is 64% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Dean Foods and Campbell Soup, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Dean Foods 3 7 3 0 2.00
Campbell Soup 4 7 0 0 1.64

Dean Foods currently has a consensus target price of $14.67, suggesting a potential upside of 39.68%. Campbell Soup has a consensus target price of $51.50, suggesting a potential upside of 14.11%. Given Dean Foods’ stronger consensus rating and higher probable upside, analysts plainly believe Dean Foods is more favorable than Campbell Soup.

Summary

Campbell Soup beats Dean Foods on 10 of the 16 factors compared between the two stocks.

Dean Foods Company Profile

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.

Campbell Soup Company Profile

Campbell Soup Company is a food company, which manufactures and markets food products. The Company’s segments include Americas Simple Meals and Beverages; Global Biscuits and Snacks, and Campbell Fresh. The Americas Simple Meals and Beverages segment includes the retail and food service channel businesses. The segment includes the products, such as Campbell’s condensed and ready-to-serve soups; Swanson broth and stocks; Prego pasta sauces; Pace Mexican sauces; Campbell’s gravies, pasta, beans and dinner sauces; Plum food and snacks; V8 juices and beverages, and Campbell’s tomato juice. The Global Biscuits and Snacks segment includes Pepperidge Farm cookies, crackers, bakery and frozen products; Arnott’s biscuits, and Kelsen cookies. The Campbell Fresh segment includes Bolthouse Farms fresh carrots, carrot ingredients, refrigerated beverages and refrigerated salad dressings; Garden Fresh Gourmet salsa, hummus, dips and tortilla chips, and the United States refrigerated soup business.

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