Diageo (NYSE:DEO) & MGP Ingredients (NASDAQ:MGPI) Head-To-Head Survey

Diageo (NYSE:DEO) and MGP Ingredients (NASDAQ:MGPI) are both consumer staples companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, dividends, analyst recommendations, valuation, risk, earnings and profitability.

Volatility and Risk

Diageo has a beta of 0.56, meaning that its share price is 44% less volatile than the S&P 500. Comparatively, MGP Ingredients has a beta of 0.32, meaning that its share price is 68% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and recommmendations for Diageo and MGP Ingredients, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Diageo	2	3	4	0	2.22
MGP Ingredients	0	1	4	0	2.80

Diageo presently has a consensus target price of $129.00, indicating a potential upside of 23.47%. MGP Ingredients has a consensus target price of $50.33, indicating a potential upside of 44.57%. Given MGP Ingredients’ stronger consensus rating and higher possible upside, analysts clearly believe MGP Ingredients is more favorable than Diageo.

Valuation and Earnings

This table compares Diageo and MGP Ingredients”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Diageo	$20.27 billion	2.87	$3.87 billion	$6.85	15.25
MGP Ingredients	$654.72 million	1.13	$34.66 million	$0.45	77.37

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

Dividends

Diageo pays an annual dividend of $3.18 per share and has a dividend yield of 3.0%. MGP Ingredients pays an annual dividend of $0.48 per share and has a dividend yield of 1.4%. Diageo pays out 46.4% of its earnings in the form of a dividend. MGP Ingredients pays out 106.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Diageo is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional and Insider Ownership

9.0% of Diageo shares are owned by institutional investors. Comparatively, 77.1% of MGP Ingredients shares are owned by institutional investors. 34.4% of MGP Ingredients shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Diageo and MGP Ingredients’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Diageo	N/A	N/A	N/A
MGP Ingredients	1.66%	12.48%	7.64%

Summary

MGP Ingredients beats Diageo on 8 of the 15 factors compared between the two stocks.

About Diageo

Diageo plc, together with its subsidiaries, engages in the production, marketing, and sale of alcoholic beverages. The company offers scotch, gin, vodka, rum, raki, liqueur, wine, tequila, Chinese white spirits, cachaça, and brandy, as well as beer, including cider and flavored malt beverages. It also provides Chinese, Canadian, Irish, American, and Indian-Made Foreign Liquor whiskies, as well as flavored malt beverages, ready to drink, and non-alcoholic products. The company provides its products under the Johnnie Walker, Crown Royal, J&B, Buchanan’s, Smirnoff, Cîroc, Ketel One, Captain Morgan, Baileys, Don Julio, Casamigos, Tanqueray, Guinness, Shui Jing Fang, Yenì, McDowell’s, Don Papa, Aviation American, Seagram, Seagram’s 7 Crown, Zacapa, Black Dog, Black & White, Signature, Royal Challenge, Godawan, Antiquity, Gordon’s, Old Parr, Windsor, Bundaberg, Ypióca, Bulleit, and Bell’s brand names. It operates in the United States, the United Kingdom, Türkiye, Australia, Korea, India, Greater China, Brazil, Mexico, South Africa, Nigeria, and internationally. The company was incorporated in 1886 and is headquartered in London, the United Kingdom.

About MGP Ingredients

MGP Ingredients, Inc., together with its subsidiaries, engages in the production and supply of distilled spirits, branded spirits, and food ingredients in the United States and internationally. The company operates through three segments: Distillery Solutions; Branded Spirits; and Ingredient Solutions. The Distillery Solutions segment provides food grade alcohol for beverage applications that include bourbon, rye, whiskeys, as well as grain neutral spirits, include vodka and gin; and food-grade industrial alcohol, which is used as an ingredient in food products, personal care products, cleaning solutions, pharmaceuticals, and various other products. This segment also offers distillery co-products, such as dried distillers’ grain, fuel-grade alcohol for blending with gasoline, and corn oil; and provides warehouse services, including barrel put away, barrel storage, and barrel retrieval services, as well as blending services. The Branded Spirits segment provides premium plus, ultra-premium, super premium, premium, mid, and value branded distilled spirits, as well as private label products. The Ingredient Solutions segment provides specialty wheat starches for food applications under the Fibersym, Resistant Starch series, and FiberRite RW Resistant Starch names; specialty wheat proteins for food applications under the Arise and Proterra names; gluten-free textured pea proteins; commodity wheat starch for food and non-food applications; and commodity wheat proteins. It sells its products directly or through distributors to manufacturers and processors of finished packaged goods or to bakeries. The company was founded in 1941 and is based in Atchison, Kansas.