Freshpet (NASDAQ:FRPT – Get Free Report) and Sysco (NYSE:SYY – Get Free Report) are both consumer staples companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, risk, earnings, institutional ownership, valuation, dividends and profitability.
Institutional and Insider Ownership
83.4% of Sysco shares are owned by institutional investors. 4.3% of Freshpet shares are owned by insiders. Comparatively, 0.6% of Sysco shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
Profitability
This table compares Freshpet and Sysco’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Freshpet | 17.63% | 6.22% | 4.19% |
| Sysco | 2.08% | 103.57% | 8.06% |
Analyst Ratings
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Freshpet | 1 | 6 | 11 | 0 | 2.56 |
| Sysco | 0 | 7 | 9 | 0 | 2.56 |
Freshpet currently has a consensus price target of $74.88, indicating a potential upside of 45.11%. Sysco has a consensus price target of $88.15, indicating a potential upside of 16.02%. Given Freshpet’s higher probable upside, equities research analysts clearly believe Freshpet is more favorable than Sysco.
Earnings and Valuation
This table compares Freshpet and Sysco”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Freshpet | $1.10 billion | 2.30 | $139.14 million | $3.74 | 13.80 |
| Sysco | $81.37 billion | 0.45 | $1.83 billion | $3.61 | 21.05 |
Sysco has higher revenue and earnings than Freshpet. Freshpet is trading at a lower price-to-earnings ratio than Sysco, indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
Freshpet has a beta of 1.63, indicating that its share price is 63% more volatile than the S&P 500. Comparatively, Sysco has a beta of 0.65, indicating that its share price is 35% less volatile than the S&P 500.
About Freshpet
Freshpet, Inc., together with its subsidiaries, manufactures, distributes, and markets natural fresh meals and treats for dogs and cats in the United States, Canada, and Europe. It sells dog food, cat food, and dog treats under the Freshpet brand name; and Dognation and Dog Joy labels through various classes of retail, including grocery, mass, club, pet specialty, and natural, as well as online. The company was incorporated in 2004 and is headquartered in Secaucus, New Jersey.
About Sysco
Sysco Corporation, through its subsidiaries, engages in the marketing and distribution of various food and related products to the foodservice or food-away-from-home industry in the United States, Canada, the United Kingdom, France, and internationally. It operates through U.S. Foodservice Operations, International Foodservice Operations, SYGMA, and Other segments. The company distributes frozen food, such as meat, seafood, fully prepared entrées, fruits, vegetables, and desserts; canned and dry food products; fresh meat and seafood products; dairy products; beverages; imported specialties; and fresh produce products. It also supplies various non-food items, including paper products comprising disposable napkins, plates, and cups; tableware consisting of glassware and silverware; cookware, such as pots, pans, and utensils; restaurant and kitchen equipment and supplies; and cleaning supplies. The company serves restaurants, hospitals and nursing facilities, schools and colleges, hotels and motels, industrial caterers, and other foodservice venues. Sysco Corporation was incorporated in 1969 and is headquartered in Houston, Texas.
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