Financial Comparison: Woolworths Group (OTCMKTS:WOLWF) versus J Sainsbury (OTCMKTS:JSNSF)

Woolworths Group (OTCMKTS:WOLWF) and J Sainsbury (OTCMKTS:JSNSF) are both consumer defensive companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, valuation, profitability, earnings, dividends, analyst recommendations and institutional ownership.

Profitability

This table compares Woolworths Group and J Sainsbury’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Woolworths Group	N/A	N/A	N/A
J Sainsbury	N/A	N/A	N/A

Institutional & Insider Ownership

14.5% of Woolworths Group shares are held by institutional investors. Comparatively, 23.0% of J Sainsbury shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Dividends

Woolworths Group pays an annual dividend of $1.36 per share and has a dividend yield of 6.5%. J Sainsbury pays an annual dividend of $0.17 per share and has a dividend yield of 3.6%. Woolworths Group pays out 69.5% of its earnings in the form of a dividend. J Sainsbury pays out 1,061.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Woolworths Group is clearly the better dividend stock, given its higher yield and lower payout ratio.

Valuation and Earnings

This table compares Woolworths Group and J Sainsbury”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Woolworths Group	N/A	N/A	N/A	$1.96	10.71
J Sainsbury	N/A	N/A	N/A	$0.02	291.41

Woolworths Group is trading at a lower price-to-earnings ratio than J Sainsbury, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Woolworths Group and J Sainsbury, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Woolworths Group	0	1	1	0	2.50
J Sainsbury	0	0	0	0	0.00

Woolworths Group presently has a consensus target price of $34.00, indicating a potential upside of 62.37%. Given Woolworths Group’s stronger consensus rating and higher possible upside, analysts plainly believe Woolworths Group is more favorable than J Sainsbury.

Summary

Woolworths Group beats J Sainsbury on 6 of the 8 factors compared between the two stocks.

About Woolworths Group

Woolworths Group Limited operates retail stores in Australia and New Zealand. It operates through Australian Food, Australian B2B, New Zealand Food, BIG W, and Other segments. The Australian Food segment procures and resells food and related products, and provides services to customers in Australia. The Australian B2B segment engages in procurement and distribution of food and related products for resale to other businesses, as well as provision of supply chain services to business customers in Australia. The New Zealand Food segment is involved in the procurement and resale of food and drinks, and provides services to retail customers in New Zealand. BIG W segment procures and resells discount general merchandise products to customers in Australia. The Other segment operates Quantium and MyDeal retail stores The company was formerly known as Woolworths Limited and changed its name to Woolworths Group Limited in December 2017. Woolworths Group Limited was incorporated in 1924 and is based in Bella Vista, Australia.

About J Sainsbury

J Sainsbury plc, together with its subsidiaries, engages in the food, general merchandise and clothing retailing, and financial services activities in the United Kingdom and the Republic of Ireland. It operates through three segments: Retail Food, Retail General Merchandise and Clothing, and Financial Services. The company operates various store formats, including convenience stores and supermarkets. It is also involved in the online grocery and general merchandise operations. In addition, it offers financial services, such as credit cards, scorecards, and personal loans; and home, car, pet, travel, and life insurance products. J Sainsbury plc was founded in 1869 and is headquartered in London, the United Kingdom.