Contrasting Unicharm (OTCMKTS:UNICY) and Procter & Gamble (NYSE:PG)

Procter & Gamble (NYSE:PG) and Unicharm (OTCMKTS:UNICY) are both large-cap consumer staples companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, earnings, valuation, institutional ownership, risk and dividends.

Insider & Institutional Ownership

65.8% of Procter & Gamble shares are held by institutional investors. 0.2% of Procter & Gamble shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of current recommendations and price targets for Procter & Gamble and Unicharm, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Procter & Gamble	0	11	15	0	2.58
Unicharm	0	2	0	0	2.00

Procter & Gamble presently has a consensus target price of $170.57, suggesting a potential upside of 4.01%. Given Procter & Gamble’s stronger consensus rating and higher probable upside, analysts clearly believe Procter & Gamble is more favorable than Unicharm.

Profitability

This table compares Procter & Gamble and Unicharm’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Procter & Gamble	18.23%	31.02%	12.92%
Unicharm	6.65%	7.19%	5.28%

Volatility and Risk

Procter & Gamble has a beta of 0.39, suggesting that its share price is 61% less volatile than the S&P 500. Comparatively, Unicharm has a beta of 0.3, suggesting that its share price is 70% less volatile than the S&P 500.

Valuation & Earnings

This table compares Procter & Gamble and Unicharm”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Procter & Gamble	$87.03 billion	4.37	$16.05 billion	$6.64	24.70
Unicharm	$6.32 billion	1.80	$436.93 million	$0.13	25.21

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

Dividends

Procter & Gamble pays an annual dividend of $4.35 per share and has a dividend yield of 2.7%. Unicharm pays an annual dividend of $0.04 per share and has a dividend yield of 1.2%. Procter & Gamble pays out 65.5% of its earnings in the form of a dividend. Unicharm pays out 30.8% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Procter & Gamble has increased its dividend for 70 consecutive years. Procter & Gamble is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Procter & Gamble beats Unicharm on 16 of the 17 factors compared between the two stocks.

About Procter & Gamble

Procter & Gamble Co. engages in the provision of branded consumer packaged goods. It operates through the following segments: Beauty, Grooming, Health Care, Fabric and Home Care, and Baby, Feminine and Family Care. The Beauty segment offers hair, skin, and personal care. The Grooming segment consists of shave care like female and male blades and razors, pre and post shave products, and appliances. The Health Care segment includes oral care products like toothbrushes, toothpaste, and personal health care such as gastrointestinal, rapid diagnostics, respiratory, and vitamins, minerals, and supplements. The Fabric and Home care segment consists of fabric enhancers, laundry additives and detergents, and air, dish, and surface care. The Baby, Feminine and Family Care segment sells baby wipes, diapers, and pants, adult incontinence, feminine care, paper towels, tissues, and toilet paper. The company was founded by William Procter and James Gamble in 1837 and is headquartered in Cincinnati, OH.

About Unicharm

Unicharm Corporation engages in the manufacturing and sale of wellness, feminine, baby and children, kirei, and pet care products in Japan and internationally. The company's baby and child care products, including disposable diapers and wipes under the Moony, MamyPoko, Oyasumiman, and Torepanman brands; feminine care products comprise napkins, tampons, panty liners, sanitary short, panty liners, and other feminine care products under the Sofy, Center-In, and Unicharm brand names; and wellness care products include napkin-type incontinence pads, pants-type diapers, tape-type diapers, pants-type specialized urine pads, and tape-type specialized urine pads under the Lifree and Charmnap brand. It also provides masks under the Unicharm brand; home care products, including cleaning sheets under the Wave brand name; cosmetic cotton and wet wipes under the Silcot brand; and paper towels under the Cook Up brand name. In addition, the company offers pet care products that include pet foods, excrement cleanup sheets, system toilets, and disposable diapers under the Grand Deli, Best Balance, Physicalife Dog, Silver Plate, Aiken Genki, Manner Wear, Deo Sheet, Silver Spoon, AllWell, Physicalife Cat, Deo Toilet, Deo Sand, Deo Clean, and Neko Genki brands; and deodorizing beads. Further, it is involved in the manufacture and sale of industrial materials related products, etc., as well as food-packaging materials. Unicharm Corporation was incorporated in 1941 and is headquartered in Tokyo, Japan.