Head to Head Comparison: Weis Markets (WMK) vs. Sprouts Farmers Market (SFM)

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

Valuation and Earnings

This table compares Weis Markets and Sprouts Farmers Market’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Weis Markets $3.40 billion 0.34 $173.90 million $3.05 14.10
Sprouts Farmers Market $4.34 billion 0.59 $295.71 million $0.90 21.11

Sprouts Farmers Market has higher revenue and earnings than Weis Markets. Weis Markets 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.

Dividends

Weis Markets pays an annual dividend of $1.20 per share and has a dividend yield of 2.8%. Sprouts Farmers Market does not pay a dividend. Weis Markets pays out 39.3% of its earnings in the form of a dividend.

Institutional & Insider Ownership

32.0% of Weis Markets shares are owned by institutional investors. Comparatively, 87.7% of Sprouts Farmers Market shares are owned by institutional investors. 26.9% of Weis Markets shares are owned by insiders. Comparatively, 2.6% of Sprouts Farmers Market shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Volatility and Risk

Weis Markets has a beta of 0.72, meaning that its stock price is 28% less volatile than the S&P 500. Comparatively, Sprouts Farmers Market has a beta of 0.54, meaning that its stock price is 46% less volatile than the S&P 500.

Profitability

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

Net Margins Return on Equity Return on Assets
Weis Markets 2.42% 8.89% 5.94%
Sprouts Farmers Market 2.96% 18.79% 8.65%

Analyst Ratings

This is a summary of recent ratings and recommmendations for Weis Markets and Sprouts Farmers Market, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Weis Markets 0 0 0 0 N/A
Sprouts Farmers Market 1 10 10 0 2.43

Sprouts Farmers Market has a consensus target price of $25.13, suggesting a potential upside of 32.24%. Given Sprouts Farmers Market’s higher probable upside, analysts plainly believe Sprouts Farmers Market is more favorable than Weis Markets.

Summary

Sprouts Farmers Market beats Weis Markets on 11 of the 15 factors compared between the two stocks.

Weis Markets Company Profile

Weis Markets, Inc. is engaged principally in the retail sale of food in Pennsylvania and surrounding states. The Company’s retail food stores sell groceries, dairy products, frozen foods, meats, seafood, fresh produce, floral, pharmacy services, deli products, prepared foods, bakery products, beer and wine, fuel and general merchandise items, such as health and beauty care and household products. As of December 31, 2016, it had owned and operated approximately 204 retail food stores. The majority of the Company’s stores are concentrated in central and northeast Pennsylvania, central Maryland, suburban Washington, District of Columbia and Baltimore regions and New York’s Southern Tier. As of December 31, 2016, it had operated four stores in Delaware, 50 stores in Maryland, five stores in New Jersey, nine stores in New York, 121 stores in Pennsylvania, 13 stores in Virginia and two stores in West Virginia, for a total of 204 retail food stores operating under the Weis Markets name.

Sprouts Farmers Market Company Profile

Sprouts Farmers Market, Inc. is a food retailer. The Company operates as a grocery store that offers fresh, natural and organic food that includes fresh produce, bulk foods, vitamins and supplements, packaged groceries, meat and seafood, deli, baked goods, dairy products, frozen foods, body care and natural household items catering to consumers’ interest in health and wellness. As of February 23, 2017, the Company operated 256 stores in 14 states. The Company categorizes the varieties of products it sells as perishable and non-perishable. The perishable product categories include produce, meat, seafood, deli and bakery. Its non-perishable product categories include grocery, vitamins and supplements, bulk items, dairy and dairy alternatives, frozen foods, beer and wine, and natural health and body care.

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