Limoneira (NASDAQ:LMNR) & Hershey (NYSE:HSY) Critical Analysis

Limoneira (NASDAQ:LMNR) and Hershey (NYSE:HSY) are both consumer staples companies, but which is the superior stock? We will contrast the two companies based on the strength of their dividends, earnings, valuation, risk, profitability, institutional ownership and analyst recommendations.

Profitability

This table compares Limoneira and Hershey’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Limoneira	-33.03%	-13.91%	-7.50%
Hershey	12.24%	31.92%	10.71%

Volatility & Risk

Limoneira has a beta of 0.34, indicating that its share price is 66% less volatile than the S&P 500. Comparatively, Hershey has a beta of 0.1, indicating that its share price is 90% less volatile than the S&P 500.

Valuation and Earnings

This table compares Limoneira and Hershey”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Limoneira	$159.72 million	1.36	-$15.98 million	($2.39)	-5.01
Hershey	$11.69 billion	2.78	$883.26 million	$7.32	22.07

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

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Limoneira and Hershey, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Limoneira	1	1	2	0	2.25
Hershey	0	16	6	0	2.27

Limoneira presently has a consensus price target of $16.50, suggesting a potential upside of 37.84%. Hershey has a consensus price target of $203.67, suggesting a potential upside of 26.05%. Given Limoneira’s higher probable upside, research analysts plainly believe Limoneira is more favorable than Hershey.

Insider & Institutional Ownership

64.3% of Limoneira shares are owned by institutional investors. Comparatively, 58.0% of Hershey shares are owned by institutional investors. 9.2% of Limoneira shares are owned by insiders. Comparatively, 0.1% of Hershey shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Summary

Hershey beats Limoneira on 10 of the 14 factors compared between the two stocks.

About Limoneira

Limoneira Company operates as an agribusiness and real estate development company in the United States and internationally. The company operates through three divisions: Agribusiness, Rental Operations, and Real Estate Development. It grows, processes, packs, markets, and sells lemons. The company also grows avocado, oranges, and specialty citrus and other crops, including Moro blood oranges, Cara Cara oranges, Valencia oranges, Minneola tangelos, Star Ruby grapefruit, pummelos, and wine grapes. It has approximately 3,500 acres of lemons planted primarily in Ventura, Tulare, San Luis Obispo, and San Bernardino Counties in California; and Jujuy, Argentina, as well in Yuma County, Arizona, and La Serena, Chile; 1,200 acres of avocados planted in Ventura County; 100 acres of oranges planted in Tulare County, California; and 400 acres of specialty citrus and other crops. In addition, the company rents residential housing units and commercial office buildings, as well as leases approximately 400 acres of its land to third-party agricultural tenants. Further, it is involved in the organic recycling operations; and development of land parcels, multi-family housing, and single-family homes. The company markets and sells its lemons directly to food service, wholesale, and retail customers; avocados, oranges, specialty citrus, and other crops to third-party packinghouses; and wine grapes to wine producers. Limoneira Company was founded in 1893 and is headquartered in Santa Paula, California.

About Hershey

The Hershey Company, together with its subsidiaries, engages in the manufacture and sale of confectionery products and pantry items in the United States and internationally. The company operates through three segments: North America Confectionery, North America Salty Snacks, and International. It offers chocolate and non-chocolate confectionery products; gum and mint refreshment products, including mints, chewing gums, and bubble gums; protein bars; pantry items, such as baking ingredients, toppings, beverages, and sundae syrups; and snack items comprising spreads, bars, snack bites, mixes, popcorn, and pretzels. The company provides its products primarily under the Hershey’s, Reese’s, Kisses, Jolly Rancher, Almond Joy, Brookside, barkTHINS, Cadbury, Good & Plenty, Heath, Kit Kat, Payday, Rolo, Twizzlers, Whoppers, York, Ice Breakers, Breath Savers, Bubble Yum, Lily’s, SkinnyPop, Pirates Booty, Dot’s Homestyle Pretzels, and ONE Bar brands, as well as under the Pelon Pelo Rico, IO-IO, and Sofit brands. It markets and sells its products to wholesale distributors, chain grocery stores, mass merchandisers, chain drug stores, vending companies, wholesale clubs, convenience stores, dollar stores, concessionaires, and department stores. The company exports its products in approximately 80 countries worldwide. The Hershey Company was founded in 1894 and is headquartered in Hershey, Pennsylvania.