John B. Sanfilippo & Son (NASDAQ:JBSS – Get Free Report) and Rocky Mountain Chocolate Factory (NASDAQ:RMCF – Get Free Report) are both small-cap consumer staples companies, but which is the superior business? We will compare the two companies based on the strength of their valuation, dividends, risk, institutional ownership, earnings, profitability and analyst recommendations.
Insider and Institutional Ownership
70.6% of John B. Sanfilippo & Son shares are held by institutional investors. Comparatively, 50.3% of Rocky Mountain Chocolate Factory shares are held by institutional investors. 23.4% of John B. Sanfilippo & Son shares are held by company insiders. Comparatively, 25.2% of Rocky Mountain Chocolate Factory shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
Profitability
This table compares John B. Sanfilippo & Son and Rocky Mountain Chocolate Factory’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| John B. Sanfilippo & Son | 4.84% | 14.95% | 8.67% |
| Rocky Mountain Chocolate Factory | -22.25% | -130.90% | -30.50% |
Dividends
John B. Sanfilippo & Son pays an annual dividend of $0.95 per share and has a dividend yield of 1.7%. Rocky Mountain Chocolate Factory pays an annual dividend of $0.48 per share and has a dividend yield of 61.9%. John B. Sanfilippo & Son pays out 19.9% of its earnings in the form of a dividend. Rocky Mountain Chocolate Factory pays out -72.7% 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. John B. Sanfilippo & Son has increased its dividend for 8 consecutive years. Rocky Mountain Chocolate Factory is clearly the better dividend stock, given its higher yield and lower payout ratio.
Risk & Volatility
John B. Sanfilippo & Son has a beta of 0.34, meaning that its stock price is 66% less volatile than the S&P 500. Comparatively, Rocky Mountain Chocolate Factory has a beta of 0.67, meaning that its stock price is 33% less volatile than the S&P 500.
Earnings and Valuation
This table compares John B. Sanfilippo & Son and Rocky Mountain Chocolate Factory”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| John B. Sanfilippo & Son | $1.18 billion | 0.56 | $61.93 million | $4.78 | 11.80 |
| Rocky Mountain Chocolate Factory | $27.07 million | 0.28 | -$4.56 million | ($0.66) | -1.18 |
John B. Sanfilippo & Son has higher revenue and earnings than Rocky Mountain Chocolate Factory. Rocky Mountain Chocolate Factory is trading at a lower price-to-earnings ratio than John B. Sanfilippo & Son, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a breakdown of current recommendations for John B. Sanfilippo & Son and Rocky Mountain Chocolate Factory, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| John B. Sanfilippo & Son | 1 | 1 | 2 | 1 | 2.60 |
| Rocky Mountain Chocolate Factory | 1 | 0 | 0 | 0 | 1.00 |
John B. Sanfilippo & Son currently has a consensus price target of $100.00, suggesting a potential upside of 77.24%. Given John B. Sanfilippo & Son’s stronger consensus rating and higher probable upside, analysts plainly believe John B. Sanfilippo & Son is more favorable than Rocky Mountain Chocolate Factory.
Summary
John B. Sanfilippo & Son beats Rocky Mountain Chocolate Factory on 14 of the 18 factors compared between the two stocks.
About John B. Sanfilippo & Son
John B. Sanfilippo & Son, Inc. processes, packages and markets nuts and nut-based products. Its offerings include snack and baking nuts, trail mixes, nut butters, confections and other snack products, sold under company-owned brands as well as through private-label programs. The company’s brands include Fisher, Orchard Valley Harvest and Squirrel Brand. Its products reach consumers through grocery and other retail channels, as well as foodservice and industrial customers. Founded in 1922, the company is headquartered in Elgin, Illinois.
About Rocky Mountain Chocolate Factory
Rocky Mountain Chocolate Factory, Inc. is a confectionery company that manufactures and sells a variety of premium chocolate and other confectionery products. Its offerings include chocolate-covered treats, caramels, creams, clusters, fudge, truffles, molded chocolates and other specialty candies, with products generally prepared using proprietary recipes and traditional confectionery techniques. Founded in 1981, the company began in Durango, Colorado, where it continues to maintain its corporate headquarters and manufacturing operations.
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