MGP Ingredients (NASDAQ: MGPI) and Kellogg (NYSE:K) are both consumer staples companies, but which is the superior investment? We will compare the two businesses based on the strength of their earnings, risk, institutional ownership, profitability, analyst recommendations, valuation and dividends.
This is a summary of current ratings and recommmendations for MGP Ingredients and Kellogg, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
MGP Ingredients currently has a consensus price target of $68.33, indicating a potential downside of 8.58%. Kellogg has a consensus price target of $71.50, indicating a potential upside of 4.95%. Given Kellogg’s higher possible upside, analysts plainly believe Kellogg is more favorable than MGP Ingredients.
MGP Ingredients pays an annual dividend of $0.16 per share and has a dividend yield of 0.2%. Kellogg pays an annual dividend of $2.16 per share and has a dividend yield of 3.2%. MGP Ingredients pays out 7.4% of its earnings in the form of a dividend. Kellogg pays out 96.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Kellogg has increased its dividend for 12 consecutive years. Kellogg is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This table compares MGP Ingredients and Kellogg’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Volatility and Risk
MGP Ingredients has a beta of 0.95, indicating that its share price is 5% less volatile than the S&P 500. Comparatively, Kellogg has a beta of 0.52, indicating that its share price is 48% less volatile than the S&P 500.
Institutional and Insider Ownership
89.7% of Kellogg shares are owned by institutional investors. 23.5% of MGP Ingredients shares are owned by insiders. Comparatively, 1.3% of Kellogg shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
Valuation & Earnings
This table compares MGP Ingredients and Kellogg’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|MGP Ingredients||$328.08 million||3.81||$31.18 million||$2.17||34.45|
|Kellogg||$13.01 billion||1.81||$694.00 million||$2.24||30.42|
Kellogg has higher revenue and earnings than MGP Ingredients. Kellogg is trading at a lower price-to-earnings ratio than MGP Ingredients, indicating that it is currently the more affordable of the two stocks.
Kellogg beats MGP Ingredients on 9 of the 17 factors compared between the two stocks.
MGP Ingredients Company Profile
MGP Ingredients, Inc. is a producer and supplier of distilled spirits, and specialty wheat protein and starch food ingredients. The Company’s distilled spirits include bourbon and rye whiskeys, and grain neutral spirits, including vodka and gin. The Company’s segments include distillery products and ingredient solutions. The distillery products segment consists of food grade alcohol and distillery co-products, such as distillers feed and fuel grade alcohol. The ingredient solutions segment consists of specialty starches and proteins, commodity starches and commodity proteins. The distillery products segment also includes warehouse services, including barrel put away, barrel storage, and barrel retrieval services. It is also a producer of industrial alcohol for use in both food and non-food applications. The Company’s distillery products are derived from corn and other grains (including rye, barley, wheat, barley malt and milo), and its ingredient products are derived from wheat flour.
Kellogg Company Profile
Kellogg Company is a manufacturer and marketer of ready-to-eat cereal and convenience foods. The Company’s principal products are ready-to-eat cereals and convenience foods, such as cookies, crackers, savory snacks, toaster pastries, cereal bars, fruit-flavored snacks, frozen waffles and veggie foods. Its segments include U.S. Morning Foods, which includes cereal, toaster pastries, health and wellness bars, and beverages; U.S. Snacks, which includes cookies, crackers, cereal bars, savory snacks and fruit-flavored snacks; U.S. Specialty, which represents food away from home channels, including food service, convenience, vending, Girl Scouts and food manufacturing; North America Other, which includes the U.S. Frozen, Kashi and Canada operating segments; Europe, which consists of European countries; Latin America, which consists of Central and South America and includes Mexico, and Asia Pacific, which consists of Sub-Saharan Africa, Australia and other Asian and Pacific markets.
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