Luckin Coffee (OTCMKTS:LKNCY – Get Free Report) and Ambev (NYSE:ABEV – Get Free Report) are both consumer staples companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, risk, analyst recommendations, earnings, valuation, profitability and institutional ownership.
Analyst Recommendations
This is a breakdown of current ratings and recommmendations for Luckin Coffee and Ambev, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Luckin Coffee | 0 | 1 | 1 | 2 | 3.25 |
| Ambev | 2 | 3 | 1 | 0 | 1.83 |
Luckin Coffee currently has a consensus target price of $46.87, suggesting a potential upside of 42.89%. Ambev has a consensus target price of $3.13, suggesting a potential downside of 2.57%. Given Luckin Coffee’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Luckin Coffee is more favorable than Ambev.
Volatility & Risk
Institutional & Insider Ownership
0.5% of Luckin Coffee shares are held by institutional investors. Comparatively, 8.1% of Ambev shares are held by institutional investors. 2.7% of Luckin Coffee shares are held by company 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 Luckin Coffee and Ambev’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Luckin Coffee | 6.78% | 24.91% | 12.44% |
| Ambev | 18.47% | 17.48% | 11.14% |
Valuation & Earnings
This table compares Luckin Coffee and Ambev”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Luckin Coffee | $7.03 billion | 1.34 | $513.88 million | $1.68 | 19.52 |
| Ambev | $15.80 billion | 3.21 | $2.78 billion | $0.20 | 16.07 |
Ambev has higher revenue and earnings than Luckin Coffee. Ambev is trading at a lower price-to-earnings ratio than Luckin Coffee, indicating that it is currently the more affordable of the two stocks.
Summary
Luckin Coffee beats Ambev on 8 of the 14 factors compared between the two stocks.
About Luckin Coffee
Luckin Coffee Inc. offers retail services of freshly brewed drinks, and pre-made food and beverage items in the People's Republic of China. It offers hot and iced freshly brewed coffee, such as Americano, Latte, Cappuccino, Macchiato, Flat White, and Mocha, as well as specialty coffee based on market and seasonal trends; coconut milk latte products; tea drinks; pre-made beverages; and pre-made food items, such as pastries, sandwiches, and snacks. In addition, the company offers Luckin Pop premium instant coffee and inspirational cups through mobile apps and e-commerce platforms. It operates pick-up stores, relax stores, and delivery kitchens under the Luckin brand, as well as Luckin mobile app, Weixin mini-program, and other third-party platforms for third-party payment channels. Further, the company offers technical and consultation services; and manufactures materials for products. Luckin Coffee Inc. was incorporated in 2017 and is headquartered in Xiamen, the People's Republic of China.
About Ambev
Ambev S.A., through its subsidiaries, engages in the production, distribution, and sale of beer, draft beer, carbonated soft drinks, malt and food, other alcoholic beverages, and non-alcoholic and non-carbonated products in Brazil, Central America and Caribbean, Latin America South, and Canada. It offers beer primarily under the Skol, Brahma, Antarctica, Brahva, Budweiser, Bud Light, Beck, Leffe, Hoegaarden, Balboa ICE, Balboa, Atlas Golden Light, Atlas, Bucanero, Cristal, Mayabe, Presidente, Presidente Light, Brahma Light, Bohemia, The One, Corona, Modelo Especial, Stella Artois, Quilmes Clásica, Paceña, Taquiña, Huari, Becker, Cusqueña, Michelob Ultra, Busch, Pilsen, Ouro Fino, Bud 66, Banks, Deputy, Patricia, Labatt Blue, Alexander Keith’s, and Kokanee brands. The company also provides carbonated soft drinks, bottled water, isotonic beverages, energy drinks, coconut water, powdered and natural juices, and ready-to-drink teas under the Guaraná Antarctica, Gatorade, H2OH!, Pepsi Black, Lipton Iced Tea, Fusion, Pepsi-Cola, Canada Dry, Squirt, Red Rock, Red Bull, Seven Up, Nutrl, Bud Light Seltzer, Palm Bay, and Mike’s brands. It offers its products through a network of third-party distributors and a direct distribution system. The company was founded in 1885 and is headquartered in São Paulo, Brazil. Ambev S.A. is a subsidiary of Interbrew International B.V.
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