Fomento Economico Mexicano (NYSE:FMX) vs. Coffee (NASDAQ:JVA) Critical Analysis

Coffee (NASDAQ:JVA) and Fomento Economico Mexicano (NYSE:FMX) are both consumer staples companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, risk, profitability, institutional ownership, earnings, analyst recommendations and valuation.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Coffee and Fomento Economico Mexicano, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Coffee	0	0	0	0	0.00
Fomento Economico Mexicano	0	3	2	0	2.40

Fomento Economico Mexicano has a consensus price target of $107.45, suggesting a potential upside of 7.60%. Given Fomento Economico Mexicano’s stronger consensus rating and higher possible upside, analysts clearly believe Fomento Economico Mexicano is more favorable than Coffee.

Institutional & Insider Ownership

61.0% of Fomento Economico Mexicano shares are owned by institutional investors. 21.6% of Coffee shares are owned by company insiders. Comparatively, 5.7% of Fomento Economico Mexicano shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Risk and Volatility

Coffee has a beta of 1.33, meaning that its stock price is 33% more volatile than the S&P 500. Comparatively, Fomento Economico Mexicano has a beta of 0.65, meaning that its stock price is 35% less volatile than the S&P 500.

Earnings & Valuation

This table compares Coffee and Fomento Economico Mexicano”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Coffee	$78.56 million	0.33	$2.22 million	$0.64	7.14
Fomento Economico Mexicano	$42.88 billion	0.83	$1.28 billion	$4.47	22.34

Fomento Economico Mexicano has higher revenue and earnings than Coffee. Coffee is trading at a lower price-to-earnings ratio than Fomento Economico Mexicano, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Coffee and Fomento Economico Mexicano’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Coffee	4.35%	13.87%	10.11%
Fomento Economico Mexicano	3.98%	7.86%	3.53%

Summary

Fomento Economico Mexicano beats Coffee on 9 of the 14 factors compared between the two stocks.

About Coffee

Coffee Holding Co., Inc. engages in manufacturing, roasting, packaging, marketing, and distributing roasted and blended coffees in the United States, Australia, Canada, England, and China. It offers wholesale green coffee products, including unroasted raw beans that are sold to large, medium, and small roasters, as well as coffee shop operators; and roasts, blends, packages, and sells coffee under private labels in cans, brick packages, and instants of various sizes. The company also roasts and blends company label branded coffee to supermarkets, wholesalers, and individually owned stores; and sells tabletop coffee roasting equipment, instant coffees, and tea products for its customers. Its coffee brands include Cafe Caribe, Don Manuel, S&W, Cafe Supremo, Via Roma, Premier Roasters, and Harmony Bay. The company was formerly known as Transpacific International Group Corp and changed its name to Coffee Holding Co., Inc. in April 1998. Coffee Holding Co., Inc. was founded in 1971 and is headquartered in Staten Island, New York.

About Fomento Economico Mexicano

Fomento Económico Mexicano, S.A.B. de C.V., through its subsidiaries, operates as a bottler of Coca-Cola trademark beverages. The company produces, markets, and distributes Coca-Cola trademark beverages in Mexico, Guatemala, Nicaragua, Costa Rica, Panama, Colombia, Venezuela, Brazil, Argentina, and Uruguay. It also operates small-box retail chain stores in Mexico, Colombia, Peru, Chile, and Brazil under the OXXO name; retail service stations for fuels, motor oils, lubricants, and car care products under the OXXO GAS name in Mexico; and drugstores in Chile, Colombia, Ecuador, and Mexico under the Cruz Verde, Fybeca, SanaSana, YZA, La Moderna, and Farmacon names. In addition, the company is involved in the production and distribution of collers, commercial refrigeration equipment, plastic boxes, food processing, and preservation and weighing equipment; and provision of logistic transportation, distribution and maintenance, point-of-sale refrigeration, and plastics solutions, as well as distribution platform for cleaning products and consumables. Further, it operates small-box retail and food convenience chain stores in Switzerland, Germany, Austria, Luxembourg, and the Netherlands under the k kiosk, Brezelkönig, BackWerk, Ditsch, Press & Books, avec, Caffè Spettacolo, and ok.) names, as well as pretzels under the Ditsch name. The company was founded in 1890 and is based in Monterrey, Mexico.