Alico (NASDAQ:ALCO – Get Free Report) and Marzetti (NASDAQ:MZTI – Get Free Report) are both consumer staples companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, analyst recommendations, valuation, earnings, institutional ownership, profitability and dividends.
Analyst Ratings
This is a breakdown of recent ratings and target prices for Alico and Marzetti, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Alico | 0 | 1 | 1 | 1 | 3.00 |
| Marzetti | 1 | 2 | 0 | 0 | 1.67 |
Alico currently has a consensus target price of $45.00, suggesting a potential upside of 18.02%. Marzetti has a consensus target price of $135.00, suggesting a potential upside of 33.39%. Given Marzetti’s higher probable upside, analysts clearly believe Marzetti is more favorable than Alico.
Earnings and Valuation
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Alico | $44.07 million | 6.42 | -$147.33 million | $0.22 | 173.32 |
| Marzetti | $1.93 billion | 1.43 | $191.61 million | $6.97 | 14.52 |
Marzetti has higher revenue and earnings than Alico. Marzetti is trading at a lower price-to-earnings ratio than Alico, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
62.3% of Alico shares are held by institutional investors. Comparatively, 66.4% of Marzetti shares are held by institutional investors. 6.7% of Alico shares are held by company insiders. Comparatively, 29.1% of Marzetti shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
Profitability
This table compares Alico and Marzetti’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Alico | 8.98% | -20.77% | -11.09% |
| Marzetti | 9.93% | 18.22% | 13.43% |
Risk & Volatility
Alico has a beta of 0.91, meaning that its share price is 9% less volatile than the S&P 500. Comparatively, Marzetti has a beta of 0.35, meaning that its share price is 65% less volatile than the S&P 500.
Dividends
Alico pays an annual dividend of $0.20 per share and has a dividend yield of 0.5%. Marzetti pays an annual dividend of $4.00 per share and has a dividend yield of 4.0%. Alico pays out 90.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Marzetti pays out 57.4% of its earnings in the form of a dividend. Marzetti has raised its dividend for 62 consecutive years. Marzetti is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Summary
Marzetti beats Alico on 12 of the 18 factors compared between the two stocks.
About Alico
Alico, Inc., together with its subsidiaries, operates as an agribusiness and land management company in the United States. The company operates in two segments, Alico Citrus, and Land Management and Other Operations. The Alico Citrus segment engages in planting, owning, cultivating, and/or managing citrus groves to produce fruit for sale to fresh and processed citrus markets, including activities related to the purchase and resale of fruit and value-added services, which include contracting for the harvesting, marketing, and hauling of citrus. The Land Management and Other Operations segment is involved in the activities related to native plant sales, grazing and hunting leasing, management, and/or conservation of unimproved native pastureland; and activities related to rock mining royalties and other insignificant lines of business, as well as in the activities related to owning and/or leasing improved farmland. The company was incorporated in 1960 and is based in Fort Myers, Florida.
About Marzetti
Lancaster Colony Corporation engages in the manufacturing and marketing of specialty food products for the retail and foodservice channels in the United States. It operates in two segments, Retail and Foodservice. The company offers frozen garlic bread under the New York BRAND Bakery; frozen Parkerhouse style yeast and dinner rolls under the Sister Schubert's brand; salad dressings under the Marzetti, Simply Dressed, Cardini's, and Girard's brands; vegetable and fruit dips under the Marzetti brand; croutons and salad toppings under the New York BRAND Bakery, Chatham Village, and Marzetti brands; and frozen pasta under the Marzetti Frozen Pasta brand. It also manufactures and sells other products to brand license agreements, including Olive Garden dressings, Buffalo Wild Wings sauces, and Chick-fil-A sauces. The company sells its products through sales personnel, food brokers, and distributors to retailers and restaurants. Lancaster Colony Corporation was incorporated in 1961 and is based in Westerville, Ohio.
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