Diamond Foods (DMND) & J & J Snack Foods Corp. (JJSF) Critical Review

J & J Snack Foods Corp. (NASDAQ: JJSF) and Diamond Foods (NASDAQ:DMND) are both consumer staples companies, but which is the better investment? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, profitabiliy, risk, earnings and valuation.

Institutional and Insider Ownership

68.0% of J & J Snack Foods Corp. shares are owned by institutional investors. 21.0% of J & J Snack Foods Corp. shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares J & J Snack Foods Corp. and Diamond Foods’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
J & J Snack Foods Corp. $1.01 billion 2.43 $155.37 million $4.11 31.96
Diamond Foods N/A N/A N/A N/A N/A

J & J Snack Foods Corp. has higher revenue and earnings than Diamond Foods.

Dividends

J & J Snack Foods Corp. pays an annual dividend of $1.68 per share and has a dividend yield of 1.3%. Diamond Foods does not pay a dividend. J & J Snack Foods Corp. pays out 40.9% of its earnings in the form of a dividend. Diamond Foods has increased its dividend for 12 consecutive years.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for J & J Snack Foods Corp. and Diamond Foods, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
J & J Snack Foods Corp. 0 2 0 0 2.00
Diamond Foods 0 0 0 0 N/A

J & J Snack Foods Corp. currently has a consensus target price of $127.50, indicating a potential downside of 2.92%. Given J & J Snack Foods Corp.’s higher possible upside, equities analysts plainly believe J & J Snack Foods Corp. is more favorable than Diamond Foods.

Profitability

This table compares J & J Snack Foods Corp. and Diamond Foods’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
J & J Snack Foods Corp. 7.60% 12.02% 9.67%
Diamond Foods 3.46% 10.01% 2.50%

Summary

J & J Snack Foods Corp. beats Diamond Foods on 8 of the 10 factors compared between the two stocks.

J & J Snack Foods Corp. Company Profile

J & J Snack Foods Corp. is a manufacturer, marketer and distributor of a range of snack foods and beverages for the food service and retail supermarket industries. The Company operates in three business segments: Food Service, Retail Supermarkets and Frozen Beverages. Its portfolio of products includes soft pretzels, frozen beverages, frozen juice treats and desserts, stuffed sandwiches, burritos, churros, fruit pies, funnel cakes, cookies and bakery goods, and other snack foods and drinks. Its principal snack food products are soft pretzels marketed primarily under brand names SUPERPRETZEL and BAVARIAN BAKERY; frozen juice treats and desserts marketed primarily under LUIGI’S, WHOLE FRUIT, ICEE, PHILLY SWIRL and MINUTE MAID brand names; churros marketed primarily under the TIO PEPE’S, CALIFORNIA CHURROS and OREO brand names, and bakery products sold primarily under the READI-BAKE, COUNTRY HOME, MARY B’S and DADDY RAY’S brand names, as well as for private label and contract packing.

Diamond Foods Company Profile

Diamond Foods, Inc. is a United States-based snack food and culinary nut company. The Company’s product lines include Potato Chips, Snack Nuts, Popcorn, Inshell Nuts and Culinary Nuts. It sells its products under five brand names: Diamond of California, Kettle Brand, Kettle Chips, Emerald and Pop Secret. Its potato chips are sold under the Kettle Brand label in the United States and Kettle Chips brand in the United Kingdom, which are made with blends of all natural seasonings and cooked in small batches in oils. Its product line also includes better-for-you Kettle Brand Baked Potato Chips, which are available in approximately five flavors. Snack Nuts are sold under the Emerald brand. It offers popcorn in both natural kernels and various flavors of microwave popcorn. Its inshell nuts are sold under the Diamond of California brand. Its culinary nuts are sold under the Diamond of California brand offering a source of nuts for salads, vegetables, pastas and baked goods.

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