Hershey (HSY) vs. AdvancePierre Foods (APFH) Financial Contrast

Hershey (NYSE: HSY) and AdvancePierre Foods (NYSE:APFH) are both mid-cap non-cyclical consumer goods & services companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, institutional ownership, profitability, risk, dividends, valuation and earnings.

Profitability

This table compares Hershey and AdvancePierre Foods’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Hershey 9.52% 124.06% 19.16%
AdvancePierre Foods 7.00% N/A 8.96%

Dividends

Hershey pays an annual dividend of $2.62 per share and has a dividend yield of 2.4%. AdvancePierre Foods pays an annual dividend of $0.64 per share and has a dividend yield of 1.6%. Hershey pays out 78.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. AdvancePierre Foods pays out 31.2% of its earnings in the form of a dividend. AdvancePierre Foods has increased its dividend for 8 consecutive years.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Hershey and AdvancePierre Foods, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Hershey 1 7 4 0 2.25
AdvancePierre Foods 0 3 0 0 2.00

Hershey currently has a consensus target price of $114.58, indicating a potential upside of 4.86%. AdvancePierre Foods has a consensus target price of $37.67, indicating a potential downside of 6.42%. Given Hershey’s stronger consensus rating and higher probable upside, analysts plainly believe Hershey is more favorable than AdvancePierre Foods.

Institutional and Insider Ownership

51.3% of Hershey shares are owned by institutional investors. 0.9% of Hershey shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Hershey and AdvancePierre Foods’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Hershey $7.44 billion 3.09 $720.04 million $3.36 32.52
AdvancePierre Foods N/A N/A N/A $2.05 19.63

Hershey has higher revenue and earnings than AdvancePierre Foods. AdvancePierre Foods is trading at a lower price-to-earnings ratio than Hershey, indicating that it is currently the more affordable of the two stocks.

Summary

Hershey beats AdvancePierre Foods on 12 of the 14 factors compared between the two stocks.

Hershey Company Profile

The Hershey Company is a producer of chocolate in North America. The Company’s principal product offerings include chocolate and non-chocolate confectionery products; gum and mint refreshment products; pantry items, such as baking ingredients and beverages, and snack items, such as spreads, meat snacks, bars and snack bites and mixes. Its segments include North America, and International and Other. The North America segment includes its chocolate and non-chocolate confectionery business, as well as its grocery and snacks business. This includes developing and growing its business in chocolate and non-chocolate confectionery, pantry, food service and other snacking product lines. The Company distributes and sells confectionery products in export markets of Asia, Latin America, the Middle East, Europe, Africa and other regions. As of December 31, 2016, the Company marketed, sold and distributed its products under more than 80 brand names in approximately 70 countries across the world.

AdvancePierre Foods Company Profile

AdvancePierre Foods Holdings, Inc. is a producer and distributor of ready-to-eat sandwiches, sandwich components and other entrees and snacks. The Company operates through four segments. The Foodservice segment’s portfolio of products includes breakfast sandwiches, peanut butter and jelly sandwiches, Philly steaks, fully cooked hamburger-patties, country-fried steak, stuffed entrees and chicken tenders. The Retail segment sells both branded and private label ready-to-eat sandwiches, such as grilled chicken sandwiches and stuffed pockets; sandwich components, such as chicken patties, and other entrees and snacks, such as stuffed chicken breasts. The Convenience segment sells customized ready-to-eat sandwiches, such as breakfast sandwiches and burgers; sandwich components, such as chicken patties, and other entrees and snacks, such as cinnamon dough bites. The Industrial segment supplies other food producers, such as packaged food companies under short-term co-manufacturing agreements.

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