Critical Review: Marine Harvest ASA (OTCMKTS:MHGVY) and J. M. Smucker (NYSE:SJM)

Marine Harvest ASA (OTCMKTS:MHGVY) and J. M. Smucker (NYSE:SJM) are both large-cap consumer staples companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, earnings, institutional ownership, risk, profitability, valuation and analyst recommendations.

Insider & Institutional Ownership

81.7% of J. M. Smucker shares are held by institutional investors. 2.2% of J. M. Smucker shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Marine Harvest ASA and J. M. Smucker”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Marine Harvest ASA	$6.47 billion	1.81	$812.34 million	$1.59	13.94
J. M. Smucker	$8.73 billion	1.18	-$1.23 billion	($11.79)	-8.22

Marine Harvest ASA has higher earnings, but lower revenue than J. M. Smucker. J. M. Smucker is trading at a lower price-to-earnings ratio than Marine Harvest ASA, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Marine Harvest ASA and J. M. Smucker’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Marine Harvest ASA	13.70%	12.23%	5.69%
J. M. Smucker	-14.07%	15.94%	5.37%

Analyst Ratings

This is a breakdown of current recommendations for Marine Harvest ASA and J. M. Smucker, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Marine Harvest ASA	0	2	0	2	3.00
J. M. Smucker	1	9	10	0	2.45

J. M. Smucker has a consensus price target of $117.25, suggesting a potential upside of 20.94%. Given J. M. Smucker’s higher possible upside, analysts clearly believe J. M. Smucker is more favorable than Marine Harvest ASA.

Dividends

Marine Harvest ASA pays an annual dividend of $0.47 per share and has a dividend yield of 2.1%. J. M. Smucker pays an annual dividend of $4.40 per share and has a dividend yield of 4.5%. Marine Harvest ASA pays out 29.6% of its earnings in the form of a dividend. J. M. Smucker pays out -37.3% 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. J. M. Smucker has raised its dividend for 27 consecutive years. J. M. Smucker is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk and Volatility

Marine Harvest ASA has a beta of 0.92, meaning that its share price is 8% less volatile than the S&P 500. Comparatively, J. M. Smucker has a beta of 0.25, meaning that its share price is 75% less volatile than the S&P 500.

About Marine Harvest ASA

Mowi ASA, a seafood company, farms, produces, and supplies Atlantic salmon products worldwide. It operates through three segments: Feed, Farming, and Sales and Marketing. The company is involved in the salmon feed production, salmon farming and primary processing, and seafood secondary processing activities. It offers whole fish, plain and marinated fillets and steaks, hot- and cold-smoked salmon, burgers and tartars, patties, gravad, sushi, and breaded products under the Ducktrap, MOWI, and Supreme Salmon brands. The company was formerly known as Marine Harvest ASA and changed its name to Mowi ASA in December 2018. Mowi ASA was founded in 1964 and is headquartered in Bergen, Norway.

About J. M. Smucker

The J. M. Smucker Company manufactures and markets branded food and beverage products worldwide. It operates in three segments: U.S. Retail Pet Foods, U.S. Retail Coffee, and U.S. Retail Consumer Foods. The company offers mainstream roast, ground, single serve, and premium coffee; peanut butter and specialty spreads; fruit spreads, toppings, and syrups; jelly products; nut mix products; shortening and oils; frozen sandwiches and snacks; pet food and pet snacks; and foodservice hot beverage, foodservice portion control, and flour products, as well as dog and cat food, frozen handheld products, juices and beverages, and baking mixes and ingredients. It provides its products under the Meow Mix, Milk-Bone, Pup-Peroni, Canine Carry Outs, Folgers, Café Bustelo, Dunkin', Folgers, Café Bustelo, 1850, Jif, Smucker's, Smucker's Uncrustables, Robin Hood, and Five Roses. The company sells its products through direct sales and brokers to food retailers, club stores, discount and dollar stores, online retailers, pet specialty stores, natural foods stores and distributors, drug stores, military commissaries, and mass merchandisers. Smucker Company was founded in 1897 and is headquartered in Orrville, Ohio.