Contrasting Central Garden & Pet (NASDAQ:CENT) and Alto Ingredients (NASDAQ:ALTO)

Central Garden & Pet (NASDAQ:CENT) and Alto Ingredients (NASDAQ:ALTO) are both consumer discretionary companies, but which is the better investment? We will contrast the two businesses based on the strength of their dividends, profitability, institutional ownership, earnings, valuation, risk and analyst recommendations.

Valuation & Earnings

This table compares Central Garden & Pet and Alto Ingredients”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Central Garden & Pet	$3.20 billion	0.70	$107.98 million	$2.20	16.25
Alto Ingredients	$965.26 million	0.08	-$58.98 million	($0.92)	-1.12

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

Profitability

This table compares Central Garden & Pet and Alto Ingredients’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Central Garden & Pet	4.44%	10.77%	4.65%
Alto Ingredients	-7.16%	-18.78%	-10.60%

Risk and Volatility

Central Garden & Pet has a beta of 0.7, indicating that its stock price is 30% less volatile than the S&P 500. Comparatively, Alto Ingredients has a beta of 0.61, indicating that its stock price is 39% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings for Central Garden & Pet and Alto Ingredients, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Central Garden & Pet	0	2	1	0	2.33
Alto Ingredients	0	0	1	0	3.00

Central Garden & Pet presently has a consensus price target of $40.00, indicating a potential upside of 11.92%. Alto Ingredients has a consensus price target of $5.50, indicating a potential upside of 433.98%. Given Alto Ingredients’ stronger consensus rating and higher probable upside, analysts clearly believe Alto Ingredients is more favorable than Central Garden & Pet.

Insider & Institutional Ownership

16.1% of Central Garden & Pet shares are held by institutional investors. Comparatively, 42.4% of Alto Ingredients shares are held by institutional investors. 8.2% of Central Garden & Pet shares are held by company insiders. Comparatively, 5.3% of Alto Ingredients shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

Central Garden & Pet beats Alto Ingredients on 10 of the 13 factors compared between the two stocks.

About Central Garden & Pet

Central Garden & Pet Co. engages in the production and distribution of branded and private label products for the lawn, garden, and pet supplies markets. It operates through the Pet and Garden segments. The Pet segment focuses on dog and cat supplies such as dog treats and chews, toys, pet beds and containment, grooming products, waste management and training pads, supplies for aquatics, small animals, reptiles and pet birds including toys, cages and habitats, bedding, food and supplements, products for equine and livestock, animal and household health and insect control products, live fish, and small animals, as well as outdoor cushions. The Garden segment includes lawn and garden consumables such as grass, vegetable, flower and herb seed, wild bird feed, bird houses and other birding accessories, weed, grass, and other herbicides, insecticide and pesticide products, fertilizers, and live plants. The company was founded by William E. Brown in 1980 and is headquartered in Walnut Creek, CA.

About Alto Ingredients

Alto Ingredients, Inc. produces, distributes, and markets specialty alcohols, renewable fuel, and essential ingredients in the United States. The company operates in three segments: Marketing and Distribution, Pekin Campus Production, and Western Production. It offers specialty alcohols used in mouthwash, cosmetics, pharmaceuticals, hand sanitizers, disinfectants, and cleaners for health, home, and beauty markets; grain neutral spirits used in alcoholic beverages and vinegar, as well as corn germ used in corn oils in the food and beverage markets; alcohols and other products for paint applications and fertilizers in the industrial and agriculture markets; and essential ingredients include dried yeast, corn protein meal, corn protein feed, distiller's grains, and liquid feed for commercial animal feed and pet food applications, as well as yeast for human consumption. The company also provides fuel-grade ethanol used as transportation fuel and distillers corn oil used as a biodiesel feedstock, as well as fuel-grade ethanol produced by third parties. In addition, it offers transportation, storage, and delivery services through third-party service providers. The company sells ethanol to integrated oil companies and gasoline marketers; essential ingredient feed products to dairies and feedlots; and corn oil to poultry, renewable diesel, and biodiesel customers. It operates alcohol production facilities. The company was formerly known as Pacific Ethanol, Inc. and changed its name to Alto Ingredients, Inc. in January 2021. Alto Ingredients, Inc. was founded in 2003 and is headquartered in Pekin, Illinois.