Contrasting Andersons (NASDAQ:ANDE) & Metcash (OTC:MCSHF)

Andersons (NASDAQ:ANDE) and Metcash (OTC:MCSHF) are both consumer defensive companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, dividends, risk, profitability, earnings and institutional ownership.

Dividends

Andersons pays an annual dividend of $0.76 per share and has a dividend yield of 1.5%. Metcash pays an annual dividend of 0.26 per share and has a dividend yield of 10.2%. Andersons pays out 21.5% of its earnings in the form of a dividend. Metcash pays out 135.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Andersons has raised its dividend for 26 consecutive years.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Andersons and Metcash, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Andersons	0	0	1	0	3.00
Metcash	0	0	0	0	N/A

Andersons presently has a consensus target price of $65.00, suggesting a potential upside of 30.23%. Given Andersons’ higher probable upside, equities research analysts clearly believe Andersons is more favorable than Metcash.

Profitability

This table compares Andersons and Metcash’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Andersons	0.89%	7.93%	3.27%
Metcash	N/A	N/A	N/A

Institutional and Insider Ownership

87.1% of Andersons shares are owned by institutional investors. Comparatively, 29.0% of Metcash shares are owned by institutional investors. 5.1% of Andersons shares are owned by 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.

Earnings and Valuation

This table compares Andersons and Metcash’s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Andersons	$12.36 billion	0.14	$101.19 million	$3.54	14.10
Metcash	N/A	N/A	N/A	0.19	13.29

Andersons has higher revenue and earnings than Metcash. Metcash is trading at a lower price-to-earnings ratio than Andersons, indicating that it is currently the more affordable of the two stocks.

Summary

Andersons beats Metcash on 12 of the 13 factors compared between the two stocks.

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.

About Metcash

Metcash Limited operates as a wholesale distribution and marketing company in Australia. It operates through Food, Liquor, and Hardware segments. The Food segment distributes a range of products and services to independent supermarket and convenience retail outlets. The Hardware segment distributes hardware products to independent retail outlets; and operates company owned retail stores. The Liquor segment engages in the distribution of liquor products to independent retail outlets and hotels. It sells its products under the IGA, Foodland, Mitre 10, Home Hardware, Total Tools, Cellarbrations, IGA Liquor, and the Bottle-O brand names. Metcash Limited was founded in 1927 and is based in Macquarie Park, Australia.