Contrasting Marks and Spencer Group (OTCMKTS:MAKSY) and Kroger (NYSE:KR)

Marks and Spencer Group (OTCMKTS:MAKSY) and Kroger (NYSE:KR) are both retail/wholesale companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, dividends, profitability, earnings, analyst recommendations, institutional ownership and valuation.

Institutional and Insider Ownership

80.9% of Kroger shares are held by institutional investors. 0.4% of Kroger shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Dividends

Marks and Spencer Group pays an annual dividend of $0.14 per share and has a dividend yield of 1.6%. Kroger pays an annual dividend of $1.40 per share and has a dividend yield of 1.9%. Kroger pays out 38.1% of its earnings in the form of a dividend. Kroger has raised its dividend for 19 consecutive years. Kroger is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings & Valuation

This table compares Marks and Spencer Group and Kroger”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Marks and Spencer Group	$17.75 billion	0.51	$377.28 million	N/A	N/A
Kroger	$146.97 billion	0.32	$2.67 billion	$3.67	19.60

Kroger has higher revenue and earnings than Marks and Spencer Group.

Analyst Recommendations

This is a summary of recent ratings and price targets for Marks and Spencer Group and Kroger, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Marks and Spencer Group	0	1	0	2	3.33
Kroger	0	9	9	0	2.50

Kroger has a consensus target price of $70.00, suggesting a potential downside of 2.68%. Given Kroger’s higher probable upside, analysts plainly believe Kroger is more favorable than Marks and Spencer Group.

Profitability

This table compares Marks and Spencer Group and Kroger’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Marks and Spencer Group	N/A	N/A	N/A
Kroger	1.76%	30.01%	5.82%

Volatility and Risk

Marks and Spencer Group has a beta of 1.43, indicating that its stock price is 43% more volatile than the S&P 500. Comparatively, Kroger has a beta of 0.59, indicating that its stock price is 41% less volatile than the S&P 500.

Summary

Kroger beats Marks and Spencer Group on 11 of the 16 factors compared between the two stocks.

About Marks and Spencer Group

Marks and Spencer Group plc operates various retail stores. It operates through five segments: UK Clothing & Home, UK Food, International, Ocado, and All Other. The company offers protein deli and dairy; produce; ambient and in-store bakery; meals dessert and frozen; and hospitality and Food on the Move' products. The company also provides womenswear, menswear, lingerie, kids wear, and home products; financial services, including credit cards, payment solutions, insurances, savings, and loans; and renewable energy services. In addition, it invests in and develops real estate properties; operates international franchises; and provides its products online. The company also exports its products. The company was founded in 1884 and is headquartered in London, the United Kingdom.

About Kroger

The Kroger Co. operates as a food and drug retailer in the United States. The company operates combination food and drug stores, multi-department stores, marketplace stores, and price impact warehouses. Its combination food and drug stores offer natural food and organic sections, pharmacies, general merchandise, pet centers, fresh seafood, and organic produce; and multi-department stores provide apparel, home fashion and furnishings, outdoor living, electronics, automotive products, and toys. The company’s marketplace stores offer full-service grocery, pharmacy, health and beauty care, and perishable goods, as well as general merchandise, including apparel, home goods, and toys; and price impact warehouse stores provide grocery, and health and beauty care items, as well as meat, dairy, baked goods, and fresh produce items. It also manufactures and processes food products for sale in its supermarkets and online; and sells fuel through fuel centers. The Kroger Co. was founded in 1883 and is based in Cincinnati, Ohio.