Head to Head Analysis: BJ’s Wholesale Club (NYSE:BJ) versus Procter & Gamble (NYSE:PG)

Procter & Gamble (NYSE:PG) and BJ’s Wholesale Club (NYSE:BJ) are both large-cap consumer staples companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, risk, analyst recommendations, profitability, earnings, institutional ownership and valuation.

Analyst Recommendations

This is a summary of recent ratings and target prices for Procter & Gamble and BJ’s Wholesale Club, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Procter & Gamble	0	9	12	0	2.57
BJ’s Wholesale Club	0	10	10	0	2.50

Procter & Gamble currently has a consensus price target of $171.53, indicating a potential upside of 15.99%. BJ’s Wholesale Club has a consensus price target of $112.18, indicating a potential upside of 19.94%. Given BJ’s Wholesale Club’s higher possible upside, analysts clearly believe BJ’s Wholesale Club is more favorable than Procter & Gamble.

Earnings and Valuation

This table compares Procter & Gamble and BJ’s Wholesale Club”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Procter & Gamble	$84.93 billion	4.07	$15.97 billion	$6.85	21.59
BJ’s Wholesale Club	$20.50 billion	0.60	$534.42 million	$4.36	21.45

Procter & Gamble has higher revenue and earnings than BJ’s Wholesale Club. BJ’s Wholesale Club is trading at a lower price-to-earnings ratio than Procter & Gamble, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Procter & Gamble has a beta of 0.36, meaning that its stock price is 64% less volatile than the S&P 500. Comparatively, BJ’s Wholesale Club has a beta of 0.33, meaning that its stock price is 67% less volatile than the S&P 500.

Insider and Institutional Ownership

65.8% of Procter & Gamble shares are owned by institutional investors. Comparatively, 98.6% of BJ’s Wholesale Club shares are owned by institutional investors. 0.2% of Procter & Gamble shares are owned by company insiders. Comparatively, 1.4% of BJ’s Wholesale Club shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Procter & Gamble and BJ’s Wholesale Club’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Procter & Gamble	19.74%	32.63%	13.53%
BJ’s Wholesale Club	2.77%	30.40%	8.14%

Summary

Procter & Gamble beats BJ’s Wholesale Club on 11 of the 14 factors compared between the two stocks.

About Procter & Gamble

Procter & Gamble Co. engages in the provision of branded consumer packaged goods. It operates through the following segments: Beauty, Grooming, Health Care, Fabric and Home Care, and Baby, Feminine and Family Care. The Beauty segment offers hair, skin, and personal care. The Grooming segment consists of shave care like female and male blades and razors, pre and post shave products, and appliances. The Health Care segment includes oral care products like toothbrushes, toothpaste, and personal health care such as gastrointestinal, rapid diagnostics, respiratory, and vitamins, minerals, and supplements. The Fabric and Home care segment consists of fabric enhancers, laundry additives and detergents, and air, dish, and surface care. The Baby, Feminine and Family Care segment sells baby wipes, diapers, and pants, adult incontinence, feminine care, paper towels, tissues, and toilet paper. The company was founded by William Procter and James Gamble in 1837 and is headquartered in Cincinnati, OH.

About BJ’s Wholesale Club

BJ’s Wholesale Club Holdings, Inc. engages in the operation of membership warehouse clubs. Its product categories include grocery, household and pet, television and electronics, furniture, computer and tablets, patio and outdoor living, lawn and garden, baby and kids, toys, home, health and beauty, appliances, and jewelry. The company was founded in 1984 and is headquartered in Marlborough, MA.