Contrasting Japan Tob (OTCMKTS:JAPAY) & British American Tobacco (NYSE:BTI)

British American Tobacco (NYSE:BTI) and Japan Tob (OTCMKTS:JAPAY) are both large-cap consumer staples companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, profitability, risk, earnings, institutional ownership, analyst recommendations and dividends.

Volatility and Risk

British American Tobacco has a beta of 0.38, meaning that its stock price is 62% less volatile than the S&P 500. Comparatively, Japan Tob has a beta of 0.37, meaning that its stock price is 63% less volatile than the S&P 500.

Profitability

This table compares British American Tobacco and Japan Tob’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
British American Tobacco	N/A	N/A	N/A
Japan Tob	14.55%	11.97%	6.14%

Valuation & Earnings

This table compares British American Tobacco and Japan Tob”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
British American Tobacco	$25.60 billion	4.40	$3.92 billion	N/A	N/A
Japan Tob	$20.83 billion	3.10	$3.06 billion	$0.91	19.95

British American Tobacco has higher revenue and earnings than Japan Tob.

Analyst Recommendations

This is a summary of recent ratings and target prices for British American Tobacco and Japan Tob, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
British American Tobacco	2	1	5	0	2.38
Japan Tob	0	0	0	1	4.00

British American Tobacco presently has a consensus price target of $51.00, indicating a potential downside of 7.07%. Given British American Tobacco’s higher possible upside, analysts clearly believe British American Tobacco is more favorable than Japan Tob.

Dividends

British American Tobacco pays an annual dividend of $2.95 per share and has a dividend yield of 5.4%. Japan Tob pays an annual dividend of $0.41 per share and has a dividend yield of 2.3%. Japan Tob pays out 45.1% of its earnings in the form of a dividend.

Insider and Institutional Ownership

16.2% of British American Tobacco shares are owned by institutional investors. 0.0% of British American Tobacco shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Summary

British American Tobacco beats Japan Tob on 10 of the 15 factors compared between the two stocks.

About British American Tobacco

British American Tobacco p.l.c. engages in the provision of tobacco and nicotine products to consumers worldwide. It also offers vapour, heated, and modern oral nicotine products; combustible cigarettes; and traditional oral products, such as snus and moist snuff. The company offers its products under the Vuse, glo, Velo, Grizzly, Kodiak, Dunhill, Kent, Lucky Strike, Pall Mall, Rothmans, Camel, Natural American Spirit, Newport, Vogue, Viceroy, Kool, Peter Stuyvesant, Craven A, State Express 555 and Shuang Xi brands. It also distributes its products to retail outlets. British American Tobacco p.l.c. was founded in 1902 and is based in London, the United Kingdom.

About Japan Tob

Japan Tobacco Inc., a tobacco company, manufactures and sells tobacco products, pharmaceuticals, and processed foods in Japan and internationally. The company operates through three segments: Tobacco Business, Pharmaceutical, and Processed Food. It offers tobacco products, such as cigarettes, heat-not-burn tobacco products, E-vapor products, fine cut tobacco products, cigars, pipes, smokeless tobacco products, and hookah and kretek products. The company also provides reduced-risk products, including infused tobacco capsules and heated tobacco sticks. In addition, it researches and develops, manufactures, and sells prescription drugs for the therapeutic areas, such as cardiovascular, kidney and metabolism, immunity/inflammation, and central nervous system. Further, the company provides frozen and room-temperature products, such as frozen udon noodles, packed rice, and frozen okonomiyaki; bakery products; and seasonings, including yeast extracts, assembled, kelp and bonito extracts, and oyster sauces. It offers its products under the Winston, Camel, MEVIUS, and LD brands. Japan Tobacco Inc. was incorporated in 1985 and is headquartered in Tokyo, Japan.