Mondelez International (NASDAQ:MDLZ) and J & J Snack Foods (NASDAQ:JJSF) Critical Analysis

Mondelez International (NASDAQ:MDLZ) and J & J Snack Foods (NASDAQ:JJSF) are both consumer staples companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, risk, analyst recommendations, earnings, valuation, profitability and dividends.

Profitability

This table compares Mondelez International and J & J Snack Foods’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Mondelez International	6.64%	14.14%	5.17%
J & J Snack Foods	3.75%	9.01%	6.18%

Institutional & Insider Ownership

78.3% of Mondelez International shares are held by institutional investors. Comparatively, 76.0% of J & J Snack Foods shares are held by institutional investors. 0.5% of Mondelez International shares are held by company insiders. Comparatively, 20.4% of J & J Snack Foods shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Volatility and Risk

Mondelez International has a beta of 0.38, indicating that its stock price is 62% less volatile than the S&P 500. Comparatively, J & J Snack Foods has a beta of 0.38, indicating that its stock price is 62% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Mondelez International and J & J Snack Foods, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Mondelez International	0	9	13	1	2.65
J & J Snack Foods	2	0	1	0	1.67

Mondelez International currently has a consensus target price of $67.05, indicating a potential upside of 9.56%. J & J Snack Foods has a consensus target price of $120.00, indicating a potential upside of 63.84%. Given J & J Snack Foods’ higher possible upside, analysts clearly believe J & J Snack Foods is more favorable than Mondelez International.

Dividends

Mondelez International pays an annual dividend of $2.00 per share and has a dividend yield of 3.3%. J & J Snack Foods pays an annual dividend of $3.20 per share and has a dividend yield of 4.4%. Mondelez International pays out 99.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. J & J Snack Foods pays out 107.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Mondelez International has increased its dividend for 13 consecutive years and J & J Snack Foods has increased its dividend for 20 consecutive years. J & J Snack Foods is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings and Valuation

This table compares Mondelez International and J & J Snack Foods”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Mondelez International	$38.54 billion	2.04	$2.45 billion	$2.01	30.45
J & J Snack Foods	$1.58 billion	0.87	$65.60 million	$2.98	24.58

Mondelez International has higher revenue and earnings than J & J Snack Foods. J & J Snack Foods is trading at a lower price-to-earnings ratio than Mondelez International, indicating that it is currently the more affordable of the two stocks.

Summary

Mondelez International beats J & J Snack Foods on 11 of the 17 factors compared between the two stocks.

About Mondelez International

Mondelez International, Inc., through its subsidiaries, manufactures, markets, and sells snack food and beverage products in the Latin America, North America, Asia, the Middle East, Africa, and Europe. It provides biscuits and baked snacks, including cookies, crackers, salted snacks, snack bars, and cakes and pastries; chocolates; and gums and candies, as well as various cheese and grocery, and powdered beverage products. The company's brand portfolio includes Oreo, Ritz, LU, CLIF Bar, and Tate's Bake Shop biscuits and baked snacks, as well as Cadbury Dairy Milk, Milka, and Toblerone chocolate. It serves supermarket chains, wholesalers, supercenters, club stores, mass merchandisers, distributors, convenience stores, gasoline stations, drug stores, value stores, and other retail food outlets through direct store delivery, company-owned and satellite warehouses, distribution centers, third party distributors, and other facilities, as well as through independent sales offices and agents. The company also sells products directly to businesses and consumers through e-retail platforms, retailer digital platforms, as well as through its direct-to-consumer websites and social media platforms. Mondelez International, Inc. was formerly known as Kraft Foods Inc. and changed its name to Mondelez International, Inc. in October 2012. The company was incorporated in 2000 and is headquartered in Chicago, Illinois.

About J & J Snack Foods

J&J Snack Foods Corp. engages in the manufacturing of nutritional snack foods and distribution of frozen beverages to the food service and retail supermarket industries. It operates through the following segments: Food Service, Retail Supermarkets, and Frozen Beverages. The Food Service segment includes soft pretzels, frozen novelties, churros, handheld products, and baked goods. The Retail Supermarkets segment offers soft pretzel products including Superpretzel, frozen juice treats and desserts, including Luigi’s real Italian ice, Minute Maid juice bars and soft frozen lemonade, Whole Fruit frozen fruit bars and sorbet, Philly Swirl cups and sticks, ICEE Squeeze-Up Tubes and dough enrobed handheld products including Patio burritos. The Frozen Beverages segment provides frozen beverages to the food service industry primarily under the names ICEE, SLUSH PUPPIE, and PARROT ICE in the United States, Mexico, and Canada, as well as repair and maintenance services. The company was founded by Gerald B. Shreiber in 1971 and is headquartered in Mount Laurel, NJ.