Sprouts Farmers Market (NASDAQ:SFM – Get Free Report) and Andersons (NASDAQ:ANDE – Get Free Report) are both mid-cap consumer staples companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, risk, dividends, analyst recommendations, profitability, earnings and valuation.
Analyst Recommendations
This is a summary of recent ratings and recommmendations for Sprouts Farmers Market and Andersons, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Sprouts Farmers Market | 1 | 6 | 7 | 0 | 2.43 |
| Andersons | 0 | 1 | 3 | 1 | 3.00 |
Sprouts Farmers Market currently has a consensus target price of $92.25, suggesting a potential upside of 30.32%. Andersons has a consensus target price of $95.00, suggesting a potential upside of 36.81%. Given Andersons’ stronger consensus rating and higher possible upside, analysts plainly believe Andersons is more favorable than Sprouts Farmers Market.
Profitability
| Net Margins | Return on Equity | Return on Assets | |
| Sprouts Farmers Market | 5.58% | 34.84% | 11.99% |
| Andersons | 1.62% | 16.23% | 5.84% |
Valuation & Earnings
This table compares Sprouts Farmers Market and Andersons”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Sprouts Farmers Market | $8.81 billion | 0.75 | $523.67 million | $5.22 | 13.56 |
| Andersons | $11.01 billion | 0.21 | $95.71 million | $5.18 | 13.41 |
Sprouts Farmers Market has higher earnings, but lower revenue than Andersons. Andersons is trading at a lower price-to-earnings ratio than Sprouts Farmers Market, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Sprouts Farmers Market has a beta of 0.67, meaning that its stock price is 33% less volatile than the S&P 500. Comparatively, Andersons has a beta of 0.63, meaning that its stock price is 37% less volatile than the S&P 500.
Institutional & Insider Ownership
87.1% of Andersons shares are held by institutional investors. 1.3% of Sprouts Farmers Market shares are held by company insiders. Comparatively, 4.3% of Andersons shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Summary
Sprouts Farmers Market beats Andersons on 9 of the 15 factors compared between the two stocks.
About Sprouts Farmers Market
Sprouts Farmers Market, Inc., together with its subsidiaries, engages in the retailing of fresh, natural, and organic food products under the Sprouts brand in the United States. It offers perishable product categories, including fresh produce, meat and meat alternatives, seafood, deli, bakery, floral, and dairy and dairy alternatives; and non-perishable product categories, such as grocery, vitamins and supplements, bulk items, frozen foods, beer and wine, and natural health and body care. Sprouts Farmers Market, Inc. was founded in 1943 and is headquartered in Phoenix, Arizona.
About Andersons
The Andersons, Inc. operates in trade, renewables, and nutrient and industrial sectors in the United States, Canada, Mexico, Egypt, Switzerland, and internationally. It operates through three segments: Trade, Renewables, and Nutrient & Industrial. The company’s Trade segment operates grain elevators; stores commodities; and provides grain marketing, risk management, and origination services, as well as sells commodities, such as corn, soybeans, wheat, oats, ethanol, and corn oil. This segment also engages in the commodity merchandising business, as well as offers logistics for physical commodities, such as whole grains, grain products, feed ingredients, domestic fuel products, and other agricultural commodities. Its Renewables segment produces, purchases, and sells ethanol, and co-products, as well as offers facility operations, risk management, and marketing services to the ethanol plants it invests in and operates. The company’s Nutrient & Industrial segment manufactures, distributes, and retails agricultural and related plant nutrients, liquid industrial products, corncob-based products, and pelleted lime and gypsum products, as well as turf fertilizer, pesticide, and herbicide products; and crop nutrients, crop protection chemicals, and seed products, as well as provides application and agronomic services to commercial and family farmers. In addition, this segment produces corncob-based products for laboratory animal bedding and private-label cat litter, as well as absorbents, blast cleaners, carriers, and polishers; professional lawn care products for golf course and turf care markets; fertilizer and weed, and pest control products; dry and liquid agricultural nutrients, pelleted lime, gypsum, and soil amendments; and micronutrients, as well as industrial products comprising nitrogen reagents, calcium nitrate, deicers, and dust abatement products. The Andersons, Inc. was founded in 1947 and is based in Maumee, Ohio.
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