Japan Tobacco (OTCMKTS:JAPAF) & Laureate Education (NASDAQ:LAUR) Financial Analysis

Japan Tobacco (OTCMKTS:JAPAF) and Laureate Education (NASDAQ:LAUR) are both consumer discretionary companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, analyst recommendations, institutional ownership, risk, valuation, dividends and profitability.

Valuation & Earnings

This table compares Japan Tobacco and Laureate Education”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Japan Tobacco	N/A	N/A	N/A	$225.55	0.19
Laureate Education	$1.83 billion	2.92	$281.63 million	$2.23	17.40

Laureate Education has higher revenue and earnings than Japan Tobacco. Japan Tobacco is trading at a lower price-to-earnings ratio than Laureate Education, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent recommendations for Japan Tobacco and Laureate Education, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Japan Tobacco	0	0	1	0	3.00
Laureate Education	1	2	4	0	2.43

Laureate Education has a consensus price target of $40.50, indicating a potential upside of 4.38%. Given Laureate Education’s higher probable upside, analysts plainly believe Laureate Education is more favorable than Japan Tobacco.

Profitability

This table compares Japan Tobacco and Laureate Education’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Japan Tobacco	N/A	N/A	N/A
Laureate Education	17.57%	23.54%	11.72%

Insider and Institutional Ownership

24.7% of Japan Tobacco shares are held by institutional investors. Comparatively, 96.3% of Laureate Education shares are held by institutional investors. 1.5% of Laureate Education shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Dividends

Japan Tobacco pays an annual dividend of $79.70 per share and has a dividend yield of 181.5%. Laureate Education pays an annual dividend of $0.68 per share and has a dividend yield of 1.8%. Japan Tobacco pays out 35.3% of its earnings in the form of a dividend. Laureate Education pays out 30.5% 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.

Summary

Laureate Education beats Japan Tobacco on 10 of the 13 factors compared between the two stocks.

About Japan Tobacco

Japan Tobacco Inc., a tobacco company, manufactures and sells tobacco products, pharmaceuticals, and processed foods in Japan and internationally. The company operates through three segments: Tobacco Business, Pharmaceutical Business, and Processed Food Business. It offers tobacco products, such as cigarettes, heat-not-burn tobacco products, E-vapor products, fine cut tobacco products, cigars, pipes, smokeless tobacco products, and hookah and kretek products. The company provides reduced-risk products, including infused tobacco capsules and heated tobacco sticks. In addition, it researches and develops, manufactures, and sells prescription drugs for the therapeutic areas, such as cardiovascular, kidney and metabolism, immunity/inflammation, and central nervous system. Further, the company provides frozen and room-temperature products, such as frozen udon noodles, packed rice, and frozen okonomiyaki; bakery products; and seasonings, including yeast extracts, assembled, kelp and bonito extracts, and oyster sauces. It offers its products under the Winston, Camel, MEVIUS, and LD brands. Japan Tobacco Inc. was incorporated in 1985 and is headquartered in Tokyo, Japan.

About Laureate Education

Laureate Education, Inc., together with its subsidiaries, offers higher education programs and services to students through a network of universities and higher education institutions. The company provides a range of undergraduate and graduate degree programs in the areas of business and management, medicine and health sciences, and engineering and information technology through campus-based, online, and hybrid programs. It also offers specialized courses for technical and vocational training; and senior high school. Its services are provides in Mexico, Peru, and the United States. The company was formerly known as Sylvan Learning Systems, Inc. and changed its name to Laureate Education, Inc. in May 2004. Laureate Education, Inc. was founded in 1989 and is headquartered in Miami, Florida.