Reviewing Calavo Growers (NASDAQ:CVGW) and Dole (NYSE:DOLE)

Calavo Growers (NASDAQ:CVGW) and Dole (NYSE:DOLE) are both small-cap consumer staples companies, but which is the superior investment? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, profitability, valuation, dividends, earnings and risk.

Volatility and Risk

Calavo Growers has a beta of 0.41, suggesting that its stock price is 59% less volatile than the S&P 500. Comparatively, Dole has a beta of 0.65, suggesting that its stock price is 35% less volatile than the S&P 500.

Earnings and Valuation

This table compares Calavo Growers and Dole”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Calavo Growers	$693.71 million	0.56	-$1.08 million	$0.88	24.89
Dole	$8.76 billion	0.15	$125.51 million	$0.15	92.35

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

Dividends

Calavo Growers pays an annual dividend of $0.80 per share and has a dividend yield of 3.7%. Dole pays an annual dividend of $0.34 per share and has a dividend yield of 2.5%. Calavo Growers pays out 90.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Dole pays out 226.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Calavo Growers has raised its dividend for 1 consecutive years and Dole has raised its dividend for 1 consecutive years. Calavo Growers is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a summary of recent ratings and price targets for Calavo Growers and Dole, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Calavo Growers	0	2	1	0	2.33
Dole	0	2	0	0	2.00

Calavo Growers currently has a consensus price target of $40.00, indicating a potential upside of 82.65%. Dole has a consensus price target of $16.00, indicating a potential upside of 15.50%. Given Calavo Growers’ stronger consensus rating and higher probable upside, equities research analysts plainly believe Calavo Growers is more favorable than Dole.

Institutional & Insider Ownership

81.3% of Calavo Growers shares are owned by institutional investors. 7.2% of Calavo Growers shares are owned by company insiders. Comparatively, 41.8% of Dole shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares Calavo Growers and Dole’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Calavo Growers	2.28%	11.73%	7.86%
Dole	0.28%	8.17%	2.62%

Summary

Calavo Growers beats Dole on 11 of the 16 factors compared between the two stocks.

About Calavo Growers

Calavo Growers, Inc. markets and distributes avocados, prepared avocados, and other perishable foods to retail grocery and foodservice customers, club stores, mass merchandisers, food distributors, and wholesale customers worldwide. It operates through Grown and Prepared segments. The Grown segment distributes tomatoes and papayas; and procures avocados grown in California, Mexico, Peru, and Colombia. The Prepared segment is involved in the distribution of prepared avocado products, salsa, fresh-cut fruit and vegetables, fresh prepared entrees salads, wraps, sandwiches, parfaits, and fresh snacking products, as well as ready-to-heat entrees, other hot bars and various deli items, meals kit components, and salad kits. It offers its products under the Calavo brands and related logos; and Avo Fresco, Bueno, Avo Fresco, Bueno, Calavo Gold, Celebrate the Taste, El Dorado, Taste of Paradise, The First Name in Avocados, The Family of Fresh, ProRipeVIP, RIPE NOW!, Renaissance Food Group, Garden Highway Fresh Cut, Garden Highway, and Garden Highway Chef Essentials trademarks. Calavo Growers, Inc. was founded in 1924 and is headquartered in Santa Paula, California.

About Dole

Dole Food Company, Inc. (Dole) is a producer, marketer and distributor of fresh fruit and fresh vegetables. The Company is a producer of bananas and pineapples, and packaged fruit products, packaged salads and fresh-packed vegetables. The Company has three business segments: fresh fruit, fresh vegetables and packaged foods. The fresh fruit segment contains operating divisions that produce and market fresh fruit to wholesale, retail and institutional customers worldwide. The fresh vegetables segment produces and markets fresh-packed and value-added vegetables and salads to wholesale, retail and institutional customers, primarily in North America and Europe. The packaged foods segment contains several operating divisions that produce and market packaged foods, including fruit, juices, frozen fruit and healthy snack foods. In November 2013, Dole Food Company, Inc announced that an investor group acquired the remaining 60.43% interest in the Company.