Critical Review: Wal-Mart de Mexico SAB de CV (OTCMKTS:WMMVY) vs. US Foods (NYSE:USFD)

US Foods (NYSE:USFD) and Wal-Mart de Mexico SAB de CV (OTCMKTS:WMMVY) are both large-cap consumer staples companies, but which is the better business? We will contrast the two companies based on the strength of their valuation, profitability, risk, analyst recommendations, dividends, earnings and institutional ownership.

Risk and Volatility

US Foods has a beta of 0.86, suggesting that its share price is 14% less volatile than the S&P 500. Comparatively, Wal-Mart de Mexico SAB de CV has a beta of 0.63, suggesting that its share price is 37% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for US Foods and Wal-Mart de Mexico SAB de CV, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
US Foods	0	4	11	0	2.73
Wal-Mart de Mexico SAB de CV	2	2	0	0	1.50

US Foods presently has a consensus target price of $114.54, indicating a potential upside of 17.97%. Wal-Mart de Mexico SAB de CV has a consensus target price of $42.00, indicating a potential upside of 65.16%. Given Wal-Mart de Mexico SAB de CV’s higher possible upside, analysts clearly believe Wal-Mart de Mexico SAB de CV is more favorable than US Foods.

Insider & Institutional Ownership

98.8% of US Foods shares are owned by institutional investors. 0.7% of US Foods shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Earnings & Valuation

This table compares US Foods and Wal-Mart de Mexico SAB de CV”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
US Foods	$39.42 billion	0.53	$676.00 million	$3.25	29.88
Wal-Mart de Mexico SAB de CV	$52.76 billion	0.83	$2.60 billion	$1.60	15.89

Wal-Mart de Mexico SAB de CV has higher revenue and earnings than US Foods. Wal-Mart de Mexico SAB de CV is trading at a lower price-to-earnings ratio than US Foods, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares US Foods and Wal-Mart de Mexico SAB de CV’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
US Foods	1.81%	20.53%	6.32%
Wal-Mart de Mexico SAB de CV	4.90%	21.23%	10.12%

About US Foods

US Foods Holding Corp., together with its subsidiaries, engages in marketing, sale, and distribution of fresh, frozen, and dry food and non-food products to foodservice customers in the United States. The company's customers include independently owned single and multi-unit restaurants, regional concepts, national restaurant chains, hospitals, nursing homes, hotels and motels, country clubs, government and military organizations, colleges and universities, and retail locations. The company was formerly known as USF Holding Corp. and changed its name to US Foods Holding Corp. in February 2016. US Foods Holding Corp. was incorporated in 2007 and is headquartered in Rosemont, Illinois.

About Wal-Mart de Mexico SAB de CV

Wal-Mart de México, S.A.B. de C.V. owns and operates self-service stores in Mexico and Central America. The company operates discount warehouses and stores, hypermarkets, supermarkets, and membership self-service wholesale stores. It operates Bodega Aurrerá discount stores, Walmart hypermarkets, Walmart Express supermarkets, and Sam’s Club membership self-service wholesale stores. The company operates Despensa Familiar and Palí discount stores; Paiz, La Despensa de Don Juan, La Unión, and Más x Menos supermarkets; Bodegas, Maxi Bodega, and Maxi Palí stores; and Walmart hypermarkets in Costa Rica, Guatemala, Honduras, Nicaragua, and El Salvador. In addition, it imports and sells goods; develops properties; and manages real estate companies. The company was founded in 1958 and is headquartered in Mexico City, Mexico. Wal-Mart de México, S.A.B. de C.V. operates as a subsidiary of Intersalt, S. De R.l. De C.v.