Companhia Brasileira de Distribuicao (CBD) versus Eurocash (EUSHF) Critical Review

Companhia Brasileira de Distribuicao (NYSE:CBD) and Eurocash (OTCMKTS:EUSHF) are both retail/wholesale companies, but which is the better business? We will contrast the two businesses based on the strength of their profitability, dividends, institutional ownership, earnings, valuation, risk and analyst recommendations.

Valuation & Earnings

This table compares Companhia Brasileira de Distribuicao and Eurocash’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Companhia Brasileira de Distribuicao $13.99 billion 0.41 $193.87 million $0.46 47.28
Eurocash N/A N/A N/A N/A N/A

Companhia Brasileira de Distribuicao has higher revenue and earnings than Eurocash.

Profitability

This table compares Companhia Brasileira de Distribuicao and Eurocash’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Companhia Brasileira de Distribuicao 2.25% 4.54% 1.31%
Eurocash N/A N/A N/A

Analyst Recommendations

This is a breakdown of current ratings and target prices for Companhia Brasileira de Distribuicao and Eurocash, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Companhia Brasileira de Distribuicao 0 0 4 0 3.00
Eurocash 0 1 0 0 2.00

Insider & Institutional Ownership

2.1% of Companhia Brasileira de Distribuicao shares are owned by institutional investors. 0.0% of Companhia Brasileira de Distribuicao shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Dividends

Companhia Brasileira de Distribuicao pays an annual dividend of $0.38 per share and has a dividend yield of 1.7%. Eurocash does not pay a dividend. Companhia Brasileira de Distribuicao pays out 82.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Summary

Companhia Brasileira de Distribuicao beats Eurocash on 9 of the 10 factors compared between the two stocks.

Companhia Brasileira de Distribuicao Company Profile

Companhia Brasileira de Distribuição engages in the retail of food, clothing, home appliances, electronics, and other products through its chain of hypermarkets, supermarkets, specialized stores, and department stores in Brazil. The company operates through two segments, Food Retail; and Cash and Carry. The Food retail segment sells non-perishable food products, beverages, fruits, vegetables, meat, breads, cold cuts, dairy products, cleaning products, disposable products, and personal care products; and non-food products, such as clothing items, baby items, shoes and accessories, household articles, books, magazines, CDs and DVDs, stationery, handcrafts, toys, sports and camping gears, furniture, mobile phones, mattresses, pet products, and gardening products, as well as electronic products, including personal computers, software, computer accessories, and sound and image systems. This segment also offers medications and cosmetics at its drugstores; and non-food products at gas stations, as well as rents commercial spaces. It operates its supermarkets under the banners of Pão de Açúcar and Extra Supermercado; hypermarkets under the banner of Extra Hiper; and neighborhood stores under the banners of Minimercado Extra, Minuto Pão de Açúcar, and Aliados Compre Bem; and gas stations and drugstores under the banner of Extrabanner, as well as sells its products through its Websites, paodeacucar.com and extra.com.br. The Cash and Carry segment sells grocery, food, perishable, beverage, wrapping, hygiene and cleaning products, and other products to resellers, intermediate consumers, retail customers, and small and mid-sized companies through the Assaí banner. As of December 31, 2017, the company operated 882 stores, 72 gas stations, and 127 drugstores, as well as 23 distribution centers and depots in Brazilian states and the Federal District. Companhia Brasileira de Distribuição was founded in 1948 and is headquartered in São Paulo, Brazil.

Eurocash Company Profile

Eurocash S.A. distributes fast moving consumer goods (FMCG) in Poland. Its FMCG products include food products, soft drinks, alcoholic beverages, tobacco products, and household chemicals and cosmetics. The company markets its products to traditional retail stores, including small supermarkets and grocery stores; and kiosks and convenience stores at petrol stations, restaurants, hotels, cafeterias, and catering outlets. As of December 31, 2017, it operated a network of 180 Cash & Carry warehouses; 1,171 Delikatesy Centrum network supermarkets; 8,531 abc network grocery stores; and 4,905 managed stores. Eurocash S.A. is headquartered in Komorniki, Poland.

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