Critical Analysis: Albertsons Companies (NYSE:ACI) & Jeronimo Martins SGPS (OTCMKTS:JRONY)

Jeronimo Martins SGPS (OTCMKTS:JRONY) and Albertsons Companies (NYSE:ACI) are both consumer staples companies, but which is the superior investment? We will contrast the two businesses based on the strength of their valuation, dividends, risk, institutional ownership, analyst recommendations, earnings and profitability.

Volatility & Risk

Jeronimo Martins SGPS has a beta of 0.79, meaning that its share price is 21% less volatile than the S&P 500. Comparatively, Albertsons Companies has a beta of 0.37, meaning that its share price is 63% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Jeronimo Martins SGPS and Albertsons Companies, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Jeronimo Martins SGPS	0	1	3	1	3.00
Albertsons Companies	4	8	5	0	2.06

Albertsons Companies has a consensus price target of $15.31, indicating a potential upside of 21.93%. Given Albertsons Companies’ higher probable upside, analysts clearly believe Albertsons Companies is more favorable than Jeronimo Martins SGPS.

Profitability

This table compares Jeronimo Martins SGPS and Albertsons Companies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Jeronimo Martins SGPS	1.73%	20.03%	4.24%
Albertsons Companies	0.08%	45.59%	3.83%

Valuation & Earnings

This table compares Jeronimo Martins SGPS and Albertsons Companies”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Jeronimo Martins SGPS	$40.71 billion	0.32	$732.02 million	$2.35	17.77
Albertsons Companies	$83.17 billion	0.07	$217.40 million	$0.08	156.94

Jeronimo Martins SGPS has higher earnings, but lower revenue than Albertsons Companies. Jeronimo Martins SGPS is trading at a lower price-to-earnings ratio than Albertsons Companies, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

71.3% of Albertsons Companies shares are held by institutional investors. 1.2% of Albertsons Companies shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Dividends

Jeronimo Martins SGPS pays an annual dividend of $0.92 per share and has a dividend yield of 2.2%. Albertsons Companies pays an annual dividend of $0.68 per share and has a dividend yield of 5.4%. Jeronimo Martins SGPS pays out 39.1% of its earnings in the form of a dividend. Albertsons Companies pays out 850.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Albertsons Companies has raised its dividend for 1 consecutive years. Albertsons Companies is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

About Jeronimo Martins SGPS

Jerónimo Martins, SGPS, S.A. operates in the food distribution and specialized retail sectors in Portugal, Poland, and Colombia. The company operates through Portugal Retail; Portugal Cash & Carry; Poland Retail; Colombia Retail; and Others, Eliminations and Adjustments segments. It operates food stores under the Biedronka name; and a chain of health and beauty stores under the Hebe banner in Poland, as well as food stores under the Ara name in Colombia. The company also operates supermarkets under the Pingo Doce banner; and cash and carry stores under the Recheio name in Portugal, and under the Bodega del Canasto name in Colombia. In addition, it operates restaurants under the Pingo Doce name; para-pharmacies and petrol stations under Bem-Estar brand; and clothing under Code brand. Further, the company operates coffee shops and kiosks under the Jeronymo name; and chocolates and confectionary retail stores under Hussel name. Additionally, the company engages in human resources top management, real estate management and administration, training, and saline brackish waters aquaculture; wholesale of fruit and vegetables; retail management, consultancy, and logistics activities; purchase and sale of real estate; growing of crops and farming of animals; retail sale of health and beauty products; manufacture of milk and dairy products; rental of air transport equipment; and provision of business portfolio management, financial, and sea passenger water transport services. It is also involved in the trading and distribution of consumer goods; retail and wholesale of non-food products; other business support service activities; and provision of services in the area of wholesale and retail distribution. The company was founded in 1792 and is headquartered in Lisbon, Portugal. Jerónimo Martins, SGPS, S.A. operates as a subsidiary of Sociedade Francisco Manuel Dos Santos, S.G.P.S., S.A.

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.