DGE vs. BATS, RKT, TSCO, ABF, ULVR, IMB, CDGP, GUS, ART, and VINO
Should you be buying Diageo stock or one of its competitors? The main competitors of Diageo include British American Tobacco (BATS), Reckitt Benckiser Group (RKT), Tesco (TSCO), Associated British Foods (ABF), Unilever (ULVR), Imperial Brands (IMB), Chapel Down Group (CDGP), Gusbourne (GUS), Artisanal Spirits (ART), and Virgin Wines UK (VINO). These companies are all part of the "consumer defensive" sector.
Diageo (LON:DGE) and British American Tobacco (LON:BATS) are both large-cap consumer defensive companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, analyst recommendations, institutional ownership, community ranking, media sentiment, dividends, profitability, valuation and risk.
Diageo pays an annual dividend of GBX 81 per share and has a dividend yield of 2.9%. British American Tobacco pays an annual dividend of GBX 236 per share and has a dividend yield of 9.5%. Diageo pays out 5,473.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. British American Tobacco pays out -3,647.6% of its earnings in the form of a dividend. British American Tobacco is clearly the better dividend stock, given its higher yield and lower payout ratio.
Diageo has a beta of 0.33, suggesting that its share price is 67% less volatile than the S&P 500. Comparatively, British American Tobacco has a beta of 0.26, suggesting that its share price is 74% less volatile than the S&P 500.
62.2% of Diageo shares are owned by institutional investors. Comparatively, 41.4% of British American Tobacco shares are owned by institutional investors. 0.1% of Diageo shares are owned by insiders. Comparatively, 10.5% of British American Tobacco shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Diageo has a net margin of 19.67% compared to British American Tobacco's net margin of -52.66%. Diageo's return on equity of 36.41% beat British American Tobacco's return on equity.
Diageo presently has a consensus price target of GBX 3,058, indicating a potential upside of 9.19%. British American Tobacco has a consensus price target of GBX 3,166.67, indicating a potential upside of 27.95%. Given British American Tobacco's stronger consensus rating and higher probable upside, analysts clearly believe British American Tobacco is more favorable than Diageo.
Diageo received 117 more outperform votes than British American Tobacco when rated by MarketBeat users. However, 74.04% of users gave British American Tobacco an outperform vote while only 67.54% of users gave Diageo an outperform vote.
In the previous week, British American Tobacco had 1 more articles in the media than Diageo. MarketBeat recorded 4 mentions for British American Tobacco and 3 mentions for Diageo. British American Tobacco's average media sentiment score of 0.49 beat Diageo's score of -0.08 indicating that British American Tobacco is being referred to more favorably in the news media.
Diageo has higher earnings, but lower revenue than British American Tobacco. British American Tobacco is trading at a lower price-to-earnings ratio than Diageo, indicating that it is currently the more affordable of the two stocks.
Summary
Diageo beats British American Tobacco on 10 of the 19 factors compared between the two stocks.
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This chart shows the number of new MarketBeat users adding DGE and its top 5 competitors to their watchlist. Each company is represented with a line over a 90 day period.
This chart shows the average media sentiment of LON and its competitors over the past 90 days as caculated by MarketBeat. The averaged score is equivalent to the following: Very Negative Sentiment <= -1.5, Negative Sentiment > -1.5 and <= -0.5, Neutral Sentiment > -0.5 and < 0.5, Positive Sentiment >= 0.5 and < 1.5, and Very Positive Sentiment >= 1.5.
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