Reviewing Farmer Brothers (NASDAQ:FARM) & Drinks Americas (OTCMKTS:DKAM)

Farmer Brothers (NASDAQ:FARM) and Drinks Americas (OTCMKTS:DKAM) are both retail/wholesale companies, but which is the superior business? We will contrast the two businesses based on the strength of their analyst recommendations, profitability, risk, institutional ownership, valuation, dividends and earnings.

Volatility & Risk

Farmer Brothers has a beta of 1.41, suggesting that its share price is 41% more volatile than the S&P 500. Comparatively, Drinks Americas has a beta of 1.25, suggesting that its share price is 25% more volatile than the S&P 500.

Institutional and Insider Ownership

64.5% of Farmer Brothers shares are held by institutional investors. 4.6% of Farmer Brothers shares are held by 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.

Analyst Recommendations

This is a summary of recent recommendations for Farmer Brothers and Drinks Americas, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Farmer Brothers	1	1	0	0	1.50
Drinks Americas	0	0	0	0	0.00

Farmer Brothers presently has a consensus price target of $2.50, indicating a potential upside of 44.51%. Given Farmer Brothers’ stronger consensus rating and higher probable upside, equities research analysts plainly believe Farmer Brothers is more favorable than Drinks Americas.

Profitability

This table compares Farmer Brothers and Drinks Americas’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Farmer Brothers	-4.24%	-16.12%	-3.84%
Drinks Americas	N/A	N/A	N/A

Valuation and Earnings

This table compares Farmer Brothers and Drinks Americas”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Farmer Brothers	$342.28 million	0.11	-$14.52 million	($0.68)	-2.54
Drinks Americas	N/A	N/A	N/A	N/A	N/A

Drinks Americas has lower revenue, but higher earnings than Farmer Brothers.

Summary

Farmer Brothers beats Drinks Americas on 6 of the 9 factors compared between the two stocks.

About Farmer Brothers

Farmer Bros. Co. engages in the roasting, wholesale, equipment servicing, and distribution of coffee, tea, and other allied products in the United States. The company offers roast and ground coffee; frozen liquid coffee; flavoured and unflavoured iced and hot teas; culinary products, including spices, pancake and biscuit mixes, gravy and sauce mixes, soup bases, dressings, and syrups and sauces, as well as coffee filters, cups, sugar, and creamers; and other beverages comprising cappuccino, cocoa, granitas, and other blender-based beverages and concentrated and ready-to-drink cold brew and iced coffee. It also engage installation, repair, and refurbishment services for an array of coffee, tea, and juice equipment. The company serves small independent restaurants, foodservice operators, and large institutional buyers and national account customers. The company distributes its products through direct-store-delivery network, and common carriers or third-party distributors, as well as website. The company was founded in 1912 and is headquartered in Northlake, Texas.

About Drinks Americas

Drinks Americas Holdings, Ltd. produces, imports, distributes, and markets premium wine and spirits, and alcoholic beverages to beverage wholesalers in the United States and internationally. The company offers premium authentic Mexican beer products under the brand names of Day of the Dead Beer, Mexicali, Rio Bravo, Red Pig, and Chili Beer. The company also markets and distributes non-alcoholic beverages. It offers its products through various retailers and restaurant chains. Drinks Americas Holdings, Ltd. was founded in 1986 and is based in Los Angeles, California.