Walgreens Boots Alliance (NASDAQ: WBA) and Prestige Brand (NYSE:PBH) are both mid-cap retail/wholesale companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, analyst recommendations, earnings, risk, institutional ownership, profitability and dividends.

Insider & Institutional Ownership

63.4% of Walgreens Boots Alliance shares are owned by institutional investors. Comparatively, 98.6% of Prestige Brand shares are owned by institutional investors. 13.5% of Walgreens Boots Alliance shares are owned by insiders. Comparatively, 1.0% of Prestige Brand shares are owned 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.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Walgreens Boots Alliance and Prestige Brand, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Walgreens Boots Alliance 0 7 13 0 2.65
Prestige Brand 0 1 5 0 2.83

Walgreens Boots Alliance currently has a consensus price target of $86.72, suggesting a potential upside of 23.40%. Prestige Brand has a consensus price target of $64.40, suggesting a potential upside of 48.80%. Given Prestige Brand’s stronger consensus rating and higher possible upside, analysts plainly believe Prestige Brand is more favorable than Walgreens Boots Alliance.

Dividends

Walgreens Boots Alliance pays an annual dividend of $1.60 per share and has a dividend yield of 2.3%. Prestige Brand does not pay a dividend. Walgreens Boots Alliance pays out 42.3% of its earnings in the form of a dividend.

Profitability

This table compares Walgreens Boots Alliance and Prestige Brand’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Walgreens Boots Alliance 3.45% 18.36% 7.73%
Prestige Brand 11.03% 15.32% 3.56%

Earnings & Valuation

This table compares Walgreens Boots Alliance and Prestige Brand’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Walgreens Boots Alliance $118.21 billion 0.60 $4.08 billion $3.78 18.59
Prestige Brand $882.06 million 2.60 $69.39 million $2.00 21.64

Walgreens Boots Alliance has higher revenue and earnings than Prestige Brand. Walgreens Boots Alliance is trading at a lower price-to-earnings ratio than Prestige Brand, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Walgreens Boots Alliance has a beta of 1.2, indicating that its share price is 20% more volatile than the S&P 500. Comparatively, Prestige Brand has a beta of 1.19, indicating that its share price is 19% more volatile than the S&P 500.

Summary

Walgreens Boots Alliance beats Prestige Brand on 9 of the 16 factors compared between the two stocks.

About Walgreens Boots Alliance

Walgreens Boots Alliance, Inc. (Walgreens Boots Alliance) is a holding company. The Company is a global pharmacy-led, health and wellbeing enterprise. Walgreens Boots Alliance operates through three divisions, including Retail Pharmacy USA, Retail Pharmacy International and Pharmaceutical Wholesale. The Company’s products are marketed under a number of brands, which include No7, the Botanics range, Almus (generic medicines), Boots Pharmaceuticals and Soap & Glory (bathing and beauty brand). In addition, the Company has investments in Guangzhou Pharmaceuticals Corporation and Nanjing Pharmaceutical Company Limited. The Company operates in around 25 countries, which include the wholesale and distribution network with over 340 distribution centers and more than 180,000 pharmacies, health centers and hospitals in 19 countries.

About Prestige Brand

Prestige Brands Holdings, Inc. is engaged in the marketing, sales and distribution of over-the-counter healthcare and household cleaning products. The Company operates through three segments: North American Over-the-Counter (OTC) Healthcare; International Over-the-Counter Healthcare, and Household Cleaning. Its portfolio of OTC healthcare products includes core brands, such as DenTek specialty oral care products, Monistat women’s health products, Nix lice treatment, Chloraseptic sore throat treatments, Clear Eyes eye care products, Compound W wart treatments, The Doctor’s NightGuard dental protector, Little Remedies pediatric over-the-counter products, Efferdent denture care products, Luden’s throat drops, Dramamine motion sickness treatment, BC and Goody’s pain relievers, Beano gas prevention, Debrox earwax remover, and Gaviscon antacid. The Company’s portfolio of Household Cleaning brands includes the Chore Boy, Comet and Spic and Span brands.

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