Head-To-Head Analysis: Newell Brands (NASDAQ:NWL) & Grocery Outlet (NASDAQ:GO)

Grocery Outlet (NASDAQ:GO) and Newell Brands (NASDAQ:NWL) are both small-cap consumer staples companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, risk, analyst recommendations, dividends, profitability, valuation and earnings.

Insider and Institutional Ownership

99.9% of Grocery Outlet shares are held by institutional investors. Comparatively, 92.5% of Newell Brands shares are held by institutional investors. 4.5% of Grocery Outlet shares are held by insiders. Comparatively, 0.7% of Newell Brands shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares Grocery Outlet and Newell Brands”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Grocery Outlet	$4.37 billion	0.23	$39.47 million	($0.05)	-205.60
Newell Brands	$7.20 billion	0.27	-$285.00 million	($0.68)	-6.91

Grocery Outlet has higher earnings, but lower revenue than Newell Brands. Grocery Outlet is trading at a lower price-to-earnings ratio than Newell Brands, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Grocery Outlet and Newell Brands, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Grocery Outlet	2	7	4	0	2.15
Newell Brands	1	5	4	0	2.30

Grocery Outlet currently has a consensus target price of $14.50, suggesting a potential upside of 41.05%. Newell Brands has a consensus target price of $6.11, suggesting a potential upside of 30.02%. Given Grocery Outlet’s higher probable upside, analysts plainly believe Grocery Outlet is more favorable than Newell Brands.

Volatility and Risk

Grocery Outlet has a beta of 0.49, indicating that its stock price is 51% less volatile than the S&P 500. Comparatively, Newell Brands has a beta of 0.93, indicating that its stock price is 7% less volatile than the S&P 500.

Profitability

This table compares Grocery Outlet and Newell Brands’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Grocery Outlet	-0.10%	5.86%	2.13%
Newell Brands	-3.96%	9.17%	2.14%

Summary

Newell Brands beats Grocery Outlet on 7 of the 13 factors compared between the two stocks.

About Grocery Outlet

Grocery Outlet Holding Corp. operates as a retailer of consumables and fresh products sold through independently operated stores in the United States. Its stores offer products in various categories, such as dairy and deli, produce, floral, fresh meat, seafood products, grocery, general merchandise, health and beauty care, frozen food, beer and wine, and ethnic products. The company was founded in 1946 and is headquartered in Emeryville, California.

About Newell Brands

Newell Brands Inc. engages in the design, manufacture, sourcing, and distribution of consumer and commercial products worldwide. The company operates in three segments: Home and Commercial Solutions, Learning and Development, and Outdoor and Recreation. The Commercial Solutions segment provides commercial cleaning and maintenance solution products under the Rubbermaid, Rubbermaid Commercial Products, Mapa, and Spontex brands; closet and garage organization products; hygiene systems and material handling solutions; household products, such as kitchen appliances under the Crockpot, Mr. Coffee, Oster, and Sunbeam brands; small appliances under the Breville brand name in Europe; food and home storage products under the FoodSaver, Rubbermaid, Ball, and Sistema brands; fresh preserving products; vacuum sealing products; and gourmet cookware, bakeware, and cutlery under the Calphalon brand; and home fragrance products under the WoodWick and Yankee Candle brands. The Learning and Development segment offers writing instruments, including markers and highlighters, pens, and pencils; art products; activity-based products; labeling solutions; and baby gear and infant care products under the Dymo, Elmer's, EXPO, Graco, NUK, Paper Mate, Parker, and Sharpie brands. The Outdoor and Recreation segment provides outdoor and outdoor-related products, inlcuding technical apparel and on-the-go beverageware under the Campingaz, Coleman, Contigo, and Marmot brands. It serves warehouse clubs, department and drug/grocery stores, mass merchants, home centers, commercial products distributors, specialty retailers, office superstores and supply stores, contract stationers, e-commerce retailers, and sporting goods, as well as direct to consumers online, select contract customers, and other professional customers. Newell Brands Inc. was founded in 1903 and is based in Atlanta, Georgia.