Analyzing George Weston (OTCMKTS:WNGRF) and Costco Wholesale (NASDAQ:COST)

George Weston (OTCMKTS:WNGRF) and Costco Wholesale (NASDAQ:COST) are both large-cap consumer staples companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, profitability, dividends, earnings, analyst recommendations, valuation and risk.

Profitability

This table compares George Weston and Costco Wholesale’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
George Weston	1.54%	14.12%	3.38%
Costco Wholesale	3.04%	27.60%	10.63%

Valuation and Earnings

This table compares George Weston and Costco Wholesale”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
George Weston	$46.17 billion	0.63	$817.33 million	$1.86	41.95
Costco Wholesale	$303.15 billion	1.56	$9.23 billion	$20.76	51.33

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

Risk & Volatility

George Weston has a beta of 0.47, indicating that its share price is 53% less volatile than the S&P 500. Comparatively, Costco Wholesale has a beta of 0.85, indicating that its share price is 15% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent recommendations for George Weston and Costco Wholesale, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
George Weston	0	1	4	0	2.80
Costco Wholesale	1	8	24	1	2.74

Costco Wholesale has a consensus target price of $1,090.55, indicating a potential upside of 2.34%. Given Costco Wholesale’s higher possible upside, analysts clearly believe Costco Wholesale is more favorable than George Weston.

Insider & Institutional Ownership

0.0% of George Weston shares are held by institutional investors. Comparatively, 68.5% of Costco Wholesale shares are held by institutional investors. 53.6% of George Weston shares are held by insiders. Comparatively, 0.1% of Costco Wholesale 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.

Dividends

George Weston pays an annual dividend of $0.93 per share and has a dividend yield of 1.2%. Costco Wholesale pays an annual dividend of $5.88 per share and has a dividend yield of 0.6%. George Weston pays out 50.0% of its earnings in the form of a dividend. Costco Wholesale pays out 28.3% 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. Costco Wholesale has increased its dividend for 22 consecutive years.

Summary

Costco Wholesale beats George Weston on 15 of the 18 factors compared between the two stocks.

About George Weston

George Weston Limited provides food and drug retailing, and financial services in Canada. The company operates through two segments, Loblaw Companies Limited (Loblaw) and Choice Properties Real Estate Investment Trust (Choice Properties). The Loblaw segment provides grocery, pharmacy and healthcare services, health and beauty products, apparel, general merchandise, and financial services. This segment also offers credit card and other banking services, insurance brokerage services, guaranteed investment certificates, and wireless mobile products and services. The Choice Properties segment owns, operates, manages, and develops retail commercial and residential properties, leased to necessity-based tenants, industrial, and mixed-use and residential assets. It markets its products under the Shoppers Drug Mart, Joe Fresh, President’s Choice Bank, no name, Farmer’s Market, T&T, Life Brand, and PC Optimum brands. The company was founded in 1882 and is based in Toronto, Canada. George Weston Limited operates as a subsidiary of Wittington Investments, Limited.

About Costco Wholesale

Costco Wholesale Corporation, together with its subsidiaries, engages in the operation of membership warehouses in the United States, Puerto Rico, Canada, Mexico, Japan, the United Kingdom, Korea, Australia, Taiwan, China, Spain, France, Iceland, New Zealand, and Sweden. The company offers branded and private-label products in a range of merchandise categories. It offers merchandise, such as sundries, dry groceries, candies, coolers, freezers, deli, liquor, and tobacco; appliances, electronics, health and beauty aids, hardware, garden and patio products, sporting goods, tires, toys and seasonal products, office supplies, automotive care products, postages, tickets, apparel, small appliances, furniture, domestics, housewares, special order kiosks, and jewelry; and meat, produce, service deli, and bakery products. The company also operates gasoline, pharmacies, optical, food courts, hearing-aid centers, and tire installation centers; and offers business delivery, travel, grocery, and various other services online. It also operates e-commerce websites. The company was formerly known as Costco Companies, Inc. and changed its name to Costco Wholesale Corporation in August 1999. Costco Wholesale Corporation was founded in 1976 and is based in Issaquah, Washington.