Contrasting Chefs’ Warehouse (NASDAQ:CHEF) & J. M. Smucker (NYSE:SJM)

J. M. Smucker (NYSE:SJM) and Chefs’ Warehouse (NASDAQ:CHEF) are both consumer staples companies, but which is the superior investment? We will compare the two businesses based on the strength of their risk, valuation, analyst recommendations, profitability, earnings, dividends and institutional ownership.

Valuation and Earnings

This table compares J. M. Smucker and Chefs’ Warehouse”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
J. M. Smucker	$8.73 billion	1.40	-$1.23 billion	($11.79)	-9.73
Chefs’ Warehouse	$4.15 billion	0.61	$72.36 million	$1.65	37.89

Chefs’ Warehouse has lower revenue, but higher earnings than J. M. Smucker. J. M. Smucker is trading at a lower price-to-earnings ratio than Chefs’ Warehouse, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current ratings for J. M. Smucker and Chefs’ Warehouse, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
J. M. Smucker	1	9	8	0	2.39
Chefs’ Warehouse	1	1	5	0	2.57

J. M. Smucker currently has a consensus target price of $119.43, suggesting a potential upside of 4.08%. Chefs’ Warehouse has a consensus target price of $77.67, suggesting a potential upside of 24.23%. Given Chefs’ Warehouse’s stronger consensus rating and higher possible upside, analysts clearly believe Chefs’ Warehouse is more favorable than J. M. Smucker.

Risk & Volatility

J. M. Smucker has a beta of 0.22, suggesting that its stock price is 78% less volatile than the S&P 500. Comparatively, Chefs’ Warehouse has a beta of 1.26, suggesting that its stock price is 26% more volatile than the S&P 500.

Profitability

This table compares J. M. Smucker and Chefs’ Warehouse’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
J. M. Smucker	-14.07%	15.94%	5.37%
Chefs’ Warehouse	1.74%	14.75%	4.38%

Institutional and Insider Ownership

81.7% of J. M. Smucker shares are held by institutional investors. Comparatively, 91.6% of Chefs’ Warehouse shares are held by institutional investors. 2.2% of J. M. Smucker shares are held by company insiders. Comparatively, 11.9% of Chefs’ Warehouse shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

Chefs’ Warehouse beats J. M. Smucker on 9 of the 14 factors compared between the two stocks.

About J. M. Smucker

The J. M. Smucker Company manufactures and markets branded food and beverage products worldwide. It operates in three segments: U.S. Retail Pet Foods, U.S. Retail Coffee, and U.S. Retail Consumer Foods. The company offers mainstream roast, ground, single serve, and premium coffee; peanut butter and specialty spreads; fruit spreads, toppings, and syrups; jelly products; nut mix products; shortening and oils; frozen sandwiches and snacks; pet food and pet snacks; and foodservice hot beverage, foodservice portion control, and flour products, as well as dog and cat food, frozen handheld products, juices and beverages, and baking mixes and ingredients. It provides its products under the Meow Mix, Milk-Bone, Pup-Peroni, Canine Carry Outs, Folgers, Café Bustelo, Dunkin', Folgers, Café Bustelo, 1850, Jif, Smucker's, Smucker's Uncrustables, Robin Hood, and Five Roses. The company sells its products through direct sales and brokers to food retailers, club stores, discount and dollar stores, online retailers, pet specialty stores, natural foods stores and distributors, drug stores, military commissaries, and mass merchandisers. Smucker Company was founded in 1897 and is headquartered in Orrville, Ohio.

About Chefs’ Warehouse

The Chefs’ Warehouse, Inc., together with its subsidiaries, distributes specialty food and center-of-the-plate products in the United States, the Middle East, and Canada. The company’s product portfolio includes specialty food products, such as artisan charcuterie, specialty cheeses, unique oils and vinegars, truffles, caviar, chocolate, and pastry products; and center-of-the-plate products consisting of custom cut beef, seafood, and hormone-free poultry, as well as broadline food products comprising cooking oils, butter, eggs, milk, and flour. The company serves menu-driven independent restaurants, fine dining establishments, country clubs, hotels, caterers, culinary schools, bakeries, patisseries, chocolatiers, cruise lines, casinos, and specialty food stores. It markets its center-of-the-plate products directly to consumers through a mail and e-commerce platform. The Chefs’ Warehouse, Inc. was founded in 1985 and is headquartered in Ridgefield, Connecticut.