Contrasting Ajinomoto (OTCMKTS:AJINY) & Campbell’s (NASDAQ:CPB)

Ajinomoto (OTCMKTS:AJINY) and Campbell’s (NASDAQ:CPB) are both consumer staples companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, earnings, valuation, institutional ownership, risk and dividends.

Profitability

This table compares Ajinomoto and Campbell’s’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ajinomoto	N/A	N/A	N/A
Campbell’s	5.48%	19.96%	5.21%

Volatility and Risk

Ajinomoto has a beta of 0.5, suggesting that its share price is 50% less volatile than the S&P 500. Comparatively, Campbell’s has a beta of 0.01, suggesting that its share price is 99% less volatile than the S&P 500.

Valuation and Earnings

This table compares Ajinomoto and Campbell’s”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ajinomoto	$10.05 billion	2.72	$463.80 million	$0.83	33.69
Campbell’s	$10.25 billion	0.58	$602.00 million	$1.83	10.96

Campbell’s has higher revenue and earnings than Ajinomoto. Campbell’s is trading at a lower price-to-earnings ratio than Ajinomoto, indicating that it is currently the more affordable of the two stocks.

Dividends

Ajinomoto pays an annual dividend of $0.18 per share and has a dividend yield of 0.6%. Campbell’s pays an annual dividend of $1.56 per share and has a dividend yield of 7.8%. Ajinomoto pays out 21.7% of its earnings in the form of a dividend. Campbell’s pays out 85.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Analyst Ratings

This is a summary of current recommendations and price targets for Ajinomoto and Campbell’s, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ajinomoto	0	2	0	1	2.67
Campbell’s	7	14	1	0	1.73

Campbell’s has a consensus target price of $26.06, suggesting a potential upside of 29.95%. Given Campbell’s’ higher probable upside, analysts clearly believe Campbell’s is more favorable than Ajinomoto.

Insider & Institutional Ownership

52.4% of Campbell’s shares are held by institutional investors. 19.8% of Campbell’s shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

Campbell’s beats Ajinomoto on 11 of the 17 factors compared between the two stocks.

About Ajinomoto

Ajinomoto Co., Inc. engages in the seasonings and foods, frozen foods, and healthcare and other businesses in Japan and internationally. The Seasonings and Foods segment offers sauces and seasoning products under the AJI-NO-MOTO, HON-DASHI, Cook Do, Ajinomoto KK Consommé, Pure Select Mayonnaise, Ros Dee, Masako, Aji-ngon, Sazón, Sajiku, and CRISPY FRY names; and solutions and ingredients for foodservice and processed food manufacturers, processed foods, and restaurants, as well as industrial, retail, and other applications. This segment also provides instant noodles under the Knorr Cup Soup and YumYum names; coffee beverages under the Birdy and Blendy brands; powdered drink under the Birdy 3in1 name; MAXIM brand products; Chyotto Zeitakuna Kohiten brand products; and gift sets and office supplies comprising coffee vending machines, tea servers, etc. The Frozen Foods segment offers Chinese dumplings, cooked rice, noodles, desserts, shumai, processed chicken, and other products under the AJINOMOTO FRESH FROZEN, Bernardi, FRED’S, Golden Tiger, José Olé, LingLing, POSADA, and TAI PEI brands. The Healthcare and Other segment provides amino acids for applications in various industries, such as pharmaceuticals and foods; contract development and manufacturing services for pharmaceutical intermediates and active ingredients, aseptic fill finish services, etc.; personal care ingredients; and medical foods, crop services, etc. This segment also offers Ajinomoto Build-up Film, an interlayer insulating material for semiconductor packages; fundamental foods under the Glyna and Amino Aile names; sports nutrition supplements under the amino VITAL brand; and functional materials, such as activated carbon, release paper, etc. Ajinomoto Co., Inc. was founded in 1909 and is headquartered in Tokyo, Japan.

About Campbell’s

The Campbell’s Company, formerly known as Campbell Soup Company, together with its subsidiaries, manufactures and markets food and beverage products in the United States and internationally. The company operates through Meals & Beverages and Snacks segments. The Meals & Beverages segment engages in the retail and foodservice businesses in the United States and Canada. This segment provides Campbell’s condensed and ready-to-serve soups; Swanson broth and stocks; Pacific Foods broth, soups, and non-dairy beverages; Prego pasta sauces; Pace Mexican sauces; Campbell’s gravies, pasta, beans, and dinner sauces; Swanson canned poultry; V8 juices and beverages; Campbell’s tomato juice; and snacking products in foodservice in Canada. The Snacks segment retails Pepperidge Farm cookies, crackers, fresh bakery, and frozen products, which include Goldfish crackers, Snyder’s of Hanover pretzels, Lance sandwich crackers, Cape Cod and Kettle Brand potato chips, Late July snacks, Snack Factory pretzel crisps, Pop Secret popcorn, and other snacking products. This segment is also involved in the retail business in Latin America. It sells its products through retail food chains, mass discounters and merchandisers, club stores, convenience stores, drug stores, and dollar stores, as well as e-commerce and other retail, commercial, and non-commercial establishments, and independent contractor distributors. The company was founded in 1869 and is headquartered in Camden, New Jersey.