Financial Contrast: BJ’s Wholesale Club (NYSE:BJ) versus Albertsons Companies (NYSE:ACI)

Albertsons Companies (NYSE:ACI) and BJ’s Wholesale Club (NYSE:BJ) are both consumer staples companies, but which is the better business? We will contrast the two businesses based on the strength of their dividends, risk, earnings, institutional ownership, analyst recommendations, valuation and profitability.

Profitability

This table compares Albertsons Companies and BJ’s Wholesale Club’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Albertsons Companies	0.08%	45.59%	3.83%
BJ’s Wholesale Club	2.64%	27.40%	7.69%

Institutional & Insider Ownership

71.3% of Albertsons Companies shares are held by institutional investors. Comparatively, 98.6% of BJ’s Wholesale Club shares are held by institutional investors. 1.2% of Albertsons Companies shares are held by company insiders. Comparatively, 1.1% of BJ’s Wholesale Club shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Risk and Volatility

Albertsons Companies has a beta of 0.37, suggesting that its share price is 63% less volatile than the S&P 500. Comparatively, BJ’s Wholesale Club has a beta of 0.18, suggesting that its share price is 82% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and price targets for Albertsons Companies and BJ’s Wholesale Club, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Albertsons Companies	4	8	5	0	2.06
BJ’s Wholesale Club	1	9	10	0	2.45

Albertsons Companies presently has a consensus target price of $15.31, indicating a potential upside of 21.39%. BJ’s Wholesale Club has a consensus target price of $106.06, indicating a potential upside of 13.86%. Given Albertsons Companies’ higher probable upside, research analysts plainly believe Albertsons Companies is more favorable than BJ’s Wholesale Club.

Valuation and Earnings

This table compares Albertsons Companies and BJ’s Wholesale Club”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Albertsons Companies	$83.17 billion	0.07	$217.40 million	$0.08	157.62
BJ’s Wholesale Club	$21.46 billion	0.55	$578.38 million	$4.57	20.38

BJ’s Wholesale Club has lower revenue, but higher earnings than Albertsons Companies. BJ’s Wholesale Club is trading at a lower price-to-earnings ratio than Albertsons Companies, indicating that it is currently the more affordable of the two stocks.

Summary

BJ’s Wholesale Club beats Albertsons Companies on 8 of the 14 factors compared between the two stocks.

About Albertsons Companies

Albertsons Companies, Inc., through its subsidiaries, engages in the operation of food and drug stores in the United States. The company’s food and drug retail stores offer grocery products, general merchandise, health and beauty care products, pharmacy, fuel, and other items and services. It also manufactures and processes food products for sale in stores. It operates stores under various banners, including Albertsons, Safeway, Vons, Pavilions, Randalls, Tom Thumb, Carrs, Jewel-Osco, Acme, Shaw’s, Star Market, United Supermarkets, Market Street, Haggen, Kings Food Markets, and Balducci’s Food Lovers Market; and pharmacies, in-store branded coffee shops, adjacent fuel centers, distribution centers, and manufacturing facilities, as well as various digital platforms. Albertsons Companies, Inc. was founded in 1860 and is headquartered in Boise, Idaho. Albertsons Companies, Inc. operates as a subsidiary of Albertsons Investor Holdings LLC.

About BJ’s Wholesale Club

BJ’s Wholesale Club Holdings, Inc. engages in the operation of membership warehouse clubs. Its product categories include grocery, household and pet, television and electronics, furniture, computer and tablets, patio and outdoor living, lawn and garden, baby and kids, toys, home, health and beauty, appliances, and jewelry. The company was founded in 1984 and is headquartered in Marlborough, MA.