SpartanNash (NASDAQ:SPTN) and Sprouts Farmers Market (NASDAQ:SFM) Critical Review

Sprouts Farmers Market (NASDAQ:SFM) and SpartanNash (NASDAQ:SPTN) are both retail/wholesale companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, analyst recommendations, earnings, profitability, valuation, risk and institutional ownership.

Profitability

This table compares Sprouts Farmers Market and SpartanNash’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sprouts Farmers Market	5.53%	34.20%	12.43%
SpartanNash	-0.11%	8.26%	2.51%

Volatility & Risk

Sprouts Farmers Market has a beta of 0.77, meaning that its share price is 23% less volatile than the S&P 500. Comparatively, SpartanNash has a beta of 0.44, meaning that its share price is 56% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and target prices for Sprouts Farmers Market and SpartanNash, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sprouts Farmers Market	0	10	5	0	2.33
SpartanNash	0	2	0	0	2.00

Sprouts Farmers Market presently has a consensus price target of $168.20, suggesting a potential upside of 2.31%. SpartanNash has a consensus price target of $18.45, suggesting a potential downside of 30.59%. Given Sprouts Farmers Market’s stronger consensus rating and higher possible upside, equities analysts plainly believe Sprouts Farmers Market is more favorable than SpartanNash.

Institutional and Insider Ownership

84.6% of SpartanNash shares are owned by institutional investors. 1.1% of Sprouts Farmers Market shares are owned by insiders. Comparatively, 1.4% of SpartanNash shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Sprouts Farmers Market and SpartanNash”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sprouts Farmers Market	$8.07 billion	1.99	$380.60 million	$4.45	36.94
SpartanNash	$9.55 billion	0.09	$300,000.00	($0.32)	-83.06

Sprouts Farmers Market has higher earnings, but lower revenue than SpartanNash. SpartanNash is trading at a lower price-to-earnings ratio than Sprouts Farmers Market, indicating that it is currently the more affordable of the two stocks.

Summary

Sprouts Farmers Market beats SpartanNash on 11 of the 14 factors compared between the two stocks.

About Sprouts Farmers Market

Sprouts Farmers Market, Inc., together with its subsidiaries, engages in the retailing of fresh, natural, and organic food products under the Sprouts brand in the United States. It offers perishable product categories, including fresh produce, meat and meat alternatives, seafood, deli, bakery, floral, and dairy and dairy alternatives; and non-perishable product categories, such as grocery, vitamins and supplements, bulk items, frozen foods, beer and wine, and natural health and body care. Sprouts Farmers Market, Inc. was founded in 1943 and is headquartered in Phoenix, Arizona.

About SpartanNash

SpartanNash Company distributes and retails grocery products in the United States of America. It operates through Wholesale and Retail segments. The Wholesale segment offers grocery products and perishable food products, including dry groceries, produce, dairy products, meat, delicatessen items, bakery goods, frozen food, seafood, floral products, general merchandise, beverages, tobacco products, health and beauty care, and pharmaceutical products to independent retailers, national accounts, food service distributors, e-commerce providers, and corporate owned retail stores. This segment offers various support services to independent retailers. The Retail segment operates retail stores, fuel centers, and pharmacies primarily under the banners of Family Fare, Martin’s Super Markets, D&W Fresh Market, VG’s Grocery, Family Fresh Market, Supermercado Nuestra Familia, Forest Hills Foods, Dillonvale IGA, and Fresh City Market. It supplies private brand products to military commissaries. The company was formerly known as Spartan Stores, Inc. and changed its name to SpartanNash Company in November 2013. SpartanNash Company was founded in 1917 and is headquartered in Grand Rapids, Michigan.