Critical Analysis: Companhia Brasileira de Distribuicao (CBD) vs. Its Peers

Companhia Brasileira de Distribuicao (NYSE: CBD) is one of 23 public companies in the “Food Retail & Distribution” industry, but how does it weigh in compared to its peers? We will compare Companhia Brasileira de Distribuicao to related companies based on the strength of its institutional ownership, dividends, profitability, valuation, analyst recommendations, earnings and risk.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Companhia Brasileira de Distribuicao and its peers, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Companhia Brasileira de Distribuicao 0 3 1 0 2.25
Companhia Brasileira de Distribuicao Competitors 702 1425 1408 22 2.21

As a group, “Food Retail & Distribution” companies have a potential upside of 4.36%. Given Companhia Brasileira de Distribuicao’s peers higher possible upside, analysts clearly believe Companhia Brasileira de Distribuicao has less favorable growth aspects than its peers.

Profitability

This table compares Companhia Brasileira de Distribuicao and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Companhia Brasileira de Distribuicao 0.27% 5.46% 1.65%
Companhia Brasileira de Distribuicao Competitors 0.82% 32.88% 4.20%

Insider and Institutional Ownership

3.5% of Companhia Brasileira de Distribuicao shares are held by institutional investors. Comparatively, 56.1% of shares of all “Food Retail & Distribution” companies are held by institutional investors. 0.0% of Companhia Brasileira de Distribuicao shares are held by company insiders. Comparatively, 17.7% of shares of all “Food Retail & Distribution” companies are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Companhia Brasileira de Distribuicao and its peers top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Companhia Brasileira de Distribuicao $13.58 billion $776.33 million 172.64
Companhia Brasileira de Distribuicao Competitors $21.37 billion $977.24 million 37.93

Companhia Brasileira de Distribuicao’s peers have higher revenue and earnings than Companhia Brasileira de Distribuicao. Companhia Brasileira de Distribuicao is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Risk and Volatility

Companhia Brasileira de Distribuicao has a beta of 1.84, suggesting that its stock price is 84% more volatile than the S&P 500. Comparatively, Companhia Brasileira de Distribuicao’s peers have a beta of 0.93, suggesting that their average stock price is 7% less volatile than the S&P 500.

Summary

Companhia Brasileira de Distribuicao peers beat Companhia Brasileira de Distribuicao on 11 of the 13 factors compared.

About Companhia Brasileira de Distribuicao

Companhia Brasileira de Distribuicao, directly or through its subsidiaries, is engaged in the retail of food, clothing, home appliances, electronics and other items through its chain of hypermarkets, supermarkets, specialized stores and department stores principally under the trade names Pao de Acucar, Minuto Pao de Acucar, Extra Hiper, Extra Super, Minimercado Extra, Assai an the neighborhood shopping mall brand Conviva. The Company’s segments include Retail, and Cash and carry segment. The Company’s Retail segment includes the banners Pao de Acucar, Minuto Pao de Acucar, Extra Hiper, Extra Supermercado, Minimercado Extra, Posto Extra, Drogaria Extra and GPA Malls & Properties. Its Cash & Carry segment includes the brand Assai. The Company is engaged in operations of retail stores located in approximately 20 states and the Federal District of Brazil.

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