Comparing Clorox (NYSE:CLX) and Nestle (OTCMKTS:NSRGY)

Clorox (NYSE:CLX) and Nestle (OTCMKTS:NSRGY) are both large-cap consumer staples companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, earnings, dividends, analyst recommendations, valuation, risk and profitability.

Earnings & Valuation

This table compares Clorox and Nestle”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Clorox	$6.77 billion	1.95	$810.00 million	$6.37	16.99
Nestle	$103.78 billion	2.43	$12.36 billion	N/A	N/A

Nestle has higher revenue and earnings than Clorox.

Profitability

This table compares Clorox and Nestle’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Clorox	11.40%	377.86%	17.35%
Nestle	N/A	N/A	N/A

Dividends

Clorox pays an annual dividend of $4.96 per share and has a dividend yield of 4.6%. Nestle pays an annual dividend of $2.37 per share and has a dividend yield of 2.4%. Clorox pays out 77.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Clorox has increased its dividend for 47 consecutive years. Clorox is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a breakdown of current recommendations for Clorox and Nestle, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Clorox	5	11	1	0	1.76
Nestle	1	3	1	1	2.33

Clorox presently has a consensus price target of $127.60, suggesting a potential upside of 17.92%. Nestle has a consensus price target of $91.00, suggesting a potential downside of 6.92%. Given Clorox’s higher probable upside, analysts plainly believe Clorox is more favorable than Nestle.

Risk & Volatility

Clorox has a beta of 0.52, indicating that its stock price is 48% less volatile than the S&P 500. Comparatively, Nestle has a beta of 0.48, indicating that its stock price is 52% less volatile than the S&P 500.

Insider & Institutional Ownership

78.5% of Clorox shares are held by institutional investors. Comparatively, 0.6% of Nestle shares are held by institutional investors. 0.6% of Clorox shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

Clorox beats Nestle on 9 of the 15 factors compared between the two stocks.

About Clorox

The Clorox Company manufactures and markets consumer and professional products worldwide. It operates through four segments: Health and Wellness, Household, Lifestyle, and International. The Health and Wellness segment offers cleaning products, such as laundry additives and home care products primarily under the Clorox, Clorox2, Scentiva, Pine-Sol, Liquid-Plumr, Tilex, and Formula 409 brands; professional cleaning and disinfecting products under the CloroxPro and Clorox Healthcare brands; professional food service products under the Hidden Valley brand; and vitamins, minerals and supplement products under the RenewLife, Natural Vitality, NeoCell, and Rainbow Light brands in the United States. The Household segment provides cat litter products under the Fresh Step and Scoop Away brands; bags and wraps under the Glad brand; and grilling products under the Kingsford brand in the United States. The Lifestyle segment offers dressings, dips, seasonings, and sauces primarily under the Hidden Valley brand; natural personal care products under the Burt's Bees brand; and water-filtration products under the Brita brand in the United States. The International segment provides laundry additives; home care products; water-filtration systems; digestive health products; grilling products; cat litter products; food products; bags and wraps; natural personal care products; and professional cleaning and disinfecting products internationally primarily under the Clorox, Ayudin, Clorinda, Poett, Pine-Sol, Glad, Brita, RenewLife, Ever Clean and Burt's Bees brands. It sells its products primarily through mass retailers; grocery outlets; warehouse clubs; dollar stores; home hardware centers; drug, pet, and military stores; third-party and owned e-commerce channels; and distributors, as well as a direct sales force The Clorox Company was founded in 1913 and is headquartered in Oakland, California.

About Nestle

Nestlé S.A., together with its subsidiaries, operates as a food and beverage company. The company operates through Zone North America; Zone Europe; Zone Asia, Oceania, and Africa; Zone Latin America; Zone Greater China; Nespresso; and Nestlé Health Science segments. It offers baby foods under the Cerelac, Gerber, Nido, and NaturNes brands; bottled water under the Nestlé Pure Life, Perrier, Vittel, Buxton, Erikli, and S.Pellegrino brands; cereals under the Fitness, Nesquik, cheerios, and Lion Cereals brands; and chocolate and confectionery products under the KitKat, Smarties, Aero, Nestlé Les Recettes de l'Atelier, Milkybar, Baci Perugina, Quality Street, and Fitness brands. The company provides coffee products under the Nescafé, Nespresso, Nescafé Dolce Gusto, Starbucks Coffee At Home, and Blue Bottle Coffee brands; culinary, chilled, and frozen foods under the Maggi, DiGiorno, Thomy, Garden Gourmet, Sweet Earth, Hot Pockets, Stouffer's, Buitoni, Lean, and Life Cuisine brands; dairy products under the Carnation, Nido, Bear, Coffee-Mate, and La Laitière brands; and drinks under the Nesquik, Nestea, Nescafé, and Milo brands. In addition, it offers food service products under the Milo, Nescafé, Maggi, Chef, Nestea, Stouffer's, Chef-Mate, Minor's, and Lean Cuisine brand names; healthcare nutrition products under the Boost, Garden of Life, Nature's Bounty, Persona, Vital Proteins, Solgar, Peptamen, Resource, Vitaflo, Impact, and Compleat brands; ice cream products under the Movenpick, Häagen-Dazs, Nestlé Ice Cream, and Extrême brands; and pet care products under the Purina, ONE, Alpo, Felix, Pro Plan, Cat Chow, Fancy Feast, Bakers, Friskies, Dog Chow, Beneful, and Gourmet brands. The company was founded in 1866 and is headquartered in Vevey, Switzerland.