Hengan International Group (OTCMKTS:HEGIY) & Central Garden & Pet (NASDAQ:CENT) Critical Analysis

Central Garden & Pet (NASDAQ:CENT) and Hengan International Group (OTCMKTS:HEGIY) are both consumer discretionary companies, but which is the better business? We will compare the two companies based on the strength of their valuation, institutional ownership, earnings, profitability, risk, analyst recommendations and dividends.

Profitability

This table compares Central Garden & Pet and Hengan International Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Central Garden & Pet	5.20%	11.17%	4.82%
Hengan International Group	N/A	N/A	N/A

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Central Garden & Pet and Hengan International Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Central Garden & Pet	1	3	1	1	2.33
Hengan International Group	0	0	0	0	0.00

Central Garden & Pet presently has a consensus target price of $42.50, indicating a potential upside of 31.82%. Given Central Garden & Pet’s stronger consensus rating and higher possible upside, research analysts clearly believe Central Garden & Pet is more favorable than Hengan International Group.

Valuation and Earnings

This table compares Central Garden & Pet and Hengan International Group”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Central Garden & Pet	$3.13 billion	0.64	$162.84 million	$2.55	12.64
Hengan International Group	$3.15 billion	1.35	$319.73 million	N/A	N/A

Hengan International Group has higher revenue and earnings than Central Garden & Pet.

Institutional and Insider Ownership

16.1% of Central Garden & Pet shares are owned by institutional investors. Comparatively, 0.0% of Hengan International Group shares are owned by institutional investors. 8.2% of Central Garden & Pet shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Volatility and Risk

Central Garden & Pet has a beta of 0.68, suggesting that its share price is 32% less volatile than the S&P 500. Comparatively, Hengan International Group has a beta of 0.14, suggesting that its share price is 86% less volatile than the S&P 500.

Summary

Central Garden & Pet beats Hengan International Group on 10 of the 13 factors compared between the two stocks.

About Central Garden & Pet

Central Garden & Pet Co. engages in the production and distribution of branded and private label products for the lawn, garden, and pet supplies markets. It operates through the Pet and Garden segments. The Pet segment focuses on dog and cat supplies such as dog treats and chews, toys, pet beds and containment, grooming products, waste management and training pads, supplies for aquatics, small animals, reptiles and pet birds including toys, cages and habitats, bedding, food and supplements, products for equine and livestock, animal and household health and insect control products, live fish, and small animals, as well as outdoor cushions. The Garden segment includes lawn and garden consumables such as grass, vegetable, flower and herb seed, wild bird feed, bird houses and other birding accessories, weed, grass, and other herbicides, insecticide and pesticide products, fertilizers, and live plants. The company was founded by William E. Brown in 1980 and is headquartered in Walnut Creek, CA.

About Hengan International Group

Hengan International Group Company Limited, an investment holding company, manufactures, distributes, and sells personal hygiene products in the People's Republic of China and internationally. The company offers pocket handkerchiefs, box and soft tissue papers, kitchen towels/papers, toilet rolls, first-aid products, enema, garbage and food bags, preservation papers, table cloths and disposable toilet brush, sanitary napkins, pantiliners, overnight pants, wet tissues, maternal and child care products, adult and baby diapers, and cleansing products. It is also involved in the trading of various products for ladies, pregnant women, infants, and kids, as well as disposable fiber-based products; and engages in the ecommerce business. In addition, the company manufactures and distributes heat and power; and manufactures, distributes, and sells gas, protective equipment, medical instrument, skin care products, antiseptics, and household products. Hengan International Group Company Limited was founded in 1985 and is headquartered in Jinjiang, the People's Republic of China.