Financial Review: Freshpet (NASDAQ:FRPT) and B&G Foods (NYSE:BGS)

Freshpet (NASDAQ:FRPT) and B&G Foods (NYSE:BGS) are both consumer staples companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, earnings, valuation, analyst recommendations, dividends, profitability and risk.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Freshpet and B&G Foods, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Freshpet	1	7	10	0	2.50
B&G Foods	2	4	0	0	1.67

Freshpet presently has a consensus price target of $76.44, indicating a potential upside of 15.88%. B&G Foods has a consensus price target of $4.90, indicating a potential downside of 10.17%. Given Freshpet’s stronger consensus rating and higher probable upside, equities analysts clearly believe Freshpet is more favorable than B&G Foods.

Risk & Volatility

Freshpet has a beta of 1.78, suggesting that its stock price is 78% more volatile than the S&P 500. Comparatively, B&G Foods has a beta of 0.46, suggesting that its stock price is 54% less volatile than the S&P 500.

Valuation & Earnings

This table compares Freshpet and B&G Foods”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Freshpet	$1.10 billion	2.94	$139.14 million	$2.57	25.67
B&G Foods	$1.83 billion	0.24	-$43.26 million	($0.54)	-10.10

Freshpet has higher earnings, but lower revenue than B&G Foods. B&G Foods is trading at a lower price-to-earnings ratio than Freshpet, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Freshpet and B&G Foods’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Freshpet	12.63%	6.93%	4.64%
B&G Foods	-2.37%	8.43%	1.40%

Insider & Institutional Ownership

66.2% of B&G Foods shares are held by institutional investors. 4.4% of Freshpet shares are held by company insiders. Comparatively, 5.3% of B&G Foods shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Summary

Freshpet beats B&G Foods on 10 of the 14 factors compared between the two stocks.

About Freshpet

Freshpet, Inc., together with its subsidiaries, manufactures, distributes, and markets natural fresh meals and treats for dogs and cats in the United States, Canada, and Europe. It sells dog food, cat food, and dog treats under the Freshpet brand name; and Dognation and Dog Joy labels through various classes of retail, including grocery, mass, club, pet specialty, and natural, as well as online. The company was incorporated in 2004 and is headquartered in Secaucus, New Jersey.

About B&G Foods

B&G Foods, Inc. is a holding company, which engages in the manufacture, sale, and distribution of shelf-stable frozen food, and household products in the U.S., Canada, and Puerto Rico. It operates through the following segments: Specialty, Meals, Frozen & Vegetables, and Spices & Flavor Solutions. The Specialty segment includes, among others, the Crisco, Clabber Girl, Bear Creek, Polaner, Underwood, B&G, Grandma’s, New York Style, Don Pepino, Sclafani, B&M, Baker’s Joy, Regina, TrueNorth, Static Guard, SugarTwin and Brer Rabbit brands. The Meals segment focuses on the Ortega, Maple Grove Farms, Cream of Wheat, Las Palmas, Victoria, Mama Mary’s, Spring Tree, McCann’s, Carey’s and Vermont Maid brands. The Frozen & Vegetables segment consists of Green Giant and Le Sueur brands. The Spices & Flavor Solutions segment offers Dash, Spice Islands, Weber, Ac’cent, Tone’s, Trappey’s, Durkee and Wright’s brands. Its products include frozen and canned vegetables, hot cereals, fruit spreads, canned meats and beans, bagel chips, spices, seasonings, hot sauces, and wine vinegar. Its brands include Back to Nature, Bear Creek, Cream of Wheat, Green Giant, Mrs. Dash, and Ortega. The company was founded in 1889 and is headquartered in Parsippany, NJ.