Compania Cervecerias Unidas (NYSE:CCU) vs. Diageo (NYSE:DEO) Financial Analysis

Diageo (NYSE:DEO) and Compania Cervecerias Unidas (NYSE:CCU) are both consumer staples companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, dividends, risk, profitability, earnings and institutional ownership.

Dividends

Diageo pays an annual dividend of $4.95 per share and has a dividend yield of 5.6%. Compania Cervecerias Unidas pays an annual dividend of $0.22 per share and has a dividend yield of 1.6%. Compania Cervecerias Unidas pays out 28.6% of its earnings in the form of a dividend.

Earnings and Valuation

This table compares Diageo and Compania Cervecerias Unidas”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Diageo	$20.25 billion	2.45	$2.35 billion	N/A	N/A
Compania Cervecerias Unidas	$3.08 billion	0.80	$177.04 million	$0.77	17.35

Diageo has higher revenue and earnings than Compania Cervecerias Unidas.

Profitability

This table compares Diageo and Compania Cervecerias Unidas’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Diageo	N/A	N/A	N/A
Compania Cervecerias Unidas	4.48%	8.18%	3.58%

Risk and Volatility

Diageo has a beta of 0.45, indicating that its stock price is 55% less volatile than the S&P 500. Comparatively, Compania Cervecerias Unidas has a beta of 0.46, indicating that its stock price is 54% less volatile than the S&P 500.

Institutional and Insider Ownership

9.0% of Diageo shares are owned by institutional investors. Comparatively, 24.1% of Compania Cervecerias Unidas shares are owned by institutional investors. 8.4% of Compania Cervecerias Unidas shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Diageo and Compania Cervecerias Unidas, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Diageo	3	4	3	0	2.00
Compania Cervecerias Unidas	2	2	0	0	1.50

Diageo presently has a consensus target price of $119.00, suggesting a potential upside of 33.50%. Compania Cervecerias Unidas has a consensus target price of $10.00, suggesting a potential downside of 25.14%. Given Diageo’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Diageo is more favorable than Compania Cervecerias Unidas.

Summary

Diageo beats Compania Cervecerias Unidas on 8 of the 14 factors compared between the two stocks.

About Diageo

Diageo plc, together with its subsidiaries, engages in the production, marketing, and sale of alcoholic beverages. The company offers scotch, gin, vodka, rum, raki, liqueur, wine, tequila, Chinese white spirits, cachaça, and brandy, as well as beer, including cider and flavored malt beverages. It also provides Chinese, Canadian, Irish, American, and Indian-Made Foreign Liquor whiskies, as well as flavored malt beverages, ready to drink, and non-alcoholic products. The company provides its products under the Johnnie Walker, Crown Royal, J&B, Buchanan’s, Smirnoff, Cîroc, Ketel One, Captain Morgan, Baileys, Don Julio, Casamigos, Tanqueray, Guinness, Shui Jing Fang, Yenì, McDowell’s, Don Papa, Aviation American, Seagram, Seagram’s 7 Crown, Zacapa, Black Dog, Black & White, Signature, Royal Challenge, Godawan, Antiquity, Gordon’s, Old Parr, Windsor, Bundaberg, Ypióca, Bulleit, and Bell’s brand names. It operates in the United States, the United Kingdom, Türkiye, Australia, Korea, India, Greater China, Brazil, Mexico, South Africa, Nigeria, and internationally. The company was incorporated in 1886 and is headquartered in London, the United Kingdom.

About Compania Cervecerias Unidas

Compañía Cervecerías Unidas S.A. operates as a beverage company in Chile, Argentina, Bolivia, Colombia, Paraguay, and Uruguay. The company operates through three segments: Chile, International Business, and Wine. It produces and sells alcoholic and non-alcoholic beer under proprietary and licensed brands, as well as distributes Pernod Ricard products in non-supermarket retail stores. The company also produces and sells non-alcoholic beverages, including carbonated soft drinks, nectars and juices, sports and energy drinks, and ice tea; and mineral, purified, and flavored bottled water, as well as ready-to-mix products with instant powder drinks. In addition, it is involved in the production and distribution of pisco, cocktails, rum, flavored alcoholic beverages, gin, and cider. The company serves small and medium-sized retail outlets; retail establishments, such as restaurants, hotels, and bars; wholesalers; and supermarket chains. It also exports its products to Europe, Latin America, the United States, Canada, Asia, Oceania, and internationally. The company was founded in 1850 and is based in Santiago, Chile. Compañía Cervecerías Unidas S.A. is a subsidiary of Inversiones y Rentas S.A.