PepsiCo (NASDAQ: PEP) and Kirin (OTCMKTS:KNBWY) are both large-cap consumer staples companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, profitability, earnings, risk, valuation, dividends and analyst recommendations.

Dividends

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PepsiCo pays an annual dividend of $3.22 per share and has a dividend yield of 3.0%. Kirin does not pay a dividend. PepsiCo pays out 95.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Earnings and Valuation

This table compares PepsiCo and Kirin’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
PepsiCo $63.53 billion 2.42 $4.86 billion $3.37 32.15
Kirin $16.62 billion 1.49 $2.16 billion $1.59 17.04

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

Profitability

This table compares PepsiCo and Kirin’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
PepsiCo 7.65% 61.14% 9.71%
Kirin 8.10% 15.21% 6.97%

Analyst Ratings

This is a breakdown of recent ratings and price targets for PepsiCo and Kirin, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
PepsiCo 0 8 5 0 2.38
Kirin 0 0 0 0 N/A

PepsiCo currently has a consensus target price of $122.23, indicating a potential upside of 12.83%. Given PepsiCo’s higher probable upside, equities research analysts clearly believe PepsiCo is more favorable than Kirin.

Insider and Institutional Ownership

70.8% of PepsiCo shares are held by institutional investors. Comparatively, 0.2% of Kirin shares are held by institutional investors. 0.3% of PepsiCo shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Volatility and Risk

PepsiCo has a beta of 0.69, meaning that its stock price is 31% less volatile than the S&P 500. Comparatively, Kirin has a beta of 0.36, meaning that its stock price is 64% less volatile than the S&P 500.

Summary

PepsiCo beats Kirin on 13 of the 15 factors compared between the two stocks.

About PepsiCo

PepsiCo, Inc. is a global food and beverage company. The Company’s portfolio of brands includes Frito-Lay, Gatorade, Pepsi-Cola, Quaker and Tropicana. The Company operates through six segments: Frito-Lay North America (FLNA), Quaker Foods North America (QFNA), North America Beverages (NAB), Latin America, Europe Sub-Saharan Africa (ESSA), and Asia, Middle East and North Africa (AMENA). The FLNA segment includes its branded food and snack businesses in the United States and Canada. The QFNA segment includes its cereal, rice, pasta and other branded food businesses in the United States and Canada. The NAB segment includes its beverage businesses in the United States and Canada. The Latin America segment includes its beverage, food and snack businesses in Latin America. The ESSA segment includes its beverage, food and snack businesses in Europe and Sub-Saharan Africa. The AMENA segment includes its beverage, food and snack businesses in Asia, Middle East and North Africa.

About Kirin

Kirin Holdings Company, Limited is a holding company. The Company is engaged in alcohol beverages, non-alcohol beverages, and pharmaceuticals and bio-chemicals businesses. The Company’s segments include Integrated Beverages, Pharmaceuticals and Bio-chemicals, and Others. Its Others segment includes food business, such as dairy products, and others. Its businesses comprise Japan Integrated Beverages, Overseas Integrated Beverages, and Pharmaceuticals and Bio-chemicals. The Japan Integrated Beverages business conducts manufacturing and sales of alcoholic beverages and non-alcoholic beverages in Japan. The Overseas Integrated Beverages business includes Lion Nathan Limited (Lion), Schincariol Participacoes e Representacoes S.A. (Brasil Kirin) and Myanmar Brewery Limited. The Pharmaceuticals and Bio-chemicals business includes Kyowa Hakko Kirin Co., Ltd., ProStrakan Group plc and Kyowa Hakko Bio Co., Ltd.

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