Head-To-Head Contrast: Metro (OTCMKTS:MTRAF) and Eurocash (OTCMKTS:EUSHY)

Eurocash (OTCMKTS:EUSHY) and Metro (OTCMKTS:MTRAF) are both consumer defensive companies, but which is the superior stock? We will contrast the two businesses based on the strength of their dividends, analyst recommendations, profitability, risk, earnings, valuation and institutional ownership.

Profitability

This table compares Eurocash and Metro’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Eurocash	N/A	N/A	N/A
Metro	4.44%	14.73%	7.20%

Institutional and Insider Ownership

0.2% of Eurocash shares are owned by institutional investors. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Eurocash and Metro, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Eurocash	0	1	0	0	2.00
Metro	0	1	3	0	2.75

Earnings & Valuation

This table compares Eurocash and Metro”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Eurocash	N/A	N/A	N/A	$1.32	1.46
Metro	$15.74 billion	0.94	$727.05 million	$1.65	42.33

Metro has higher revenue and earnings than Eurocash. Eurocash is trading at a lower price-to-earnings ratio than Metro, indicating that it is currently the more affordable of the two stocks.

Dividends

Eurocash pays an annual dividend of $0.58 per share and has a dividend yield of 30.1%. Metro pays an annual dividend of $1.20 per share and has a dividend yield of 1.7%. Eurocash pays out 43.9% of its earnings in the form of a dividend. Metro pays out 72.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Eurocash is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Metro beats Eurocash on 8 of the 11 factors compared between the two stocks.

About Eurocash

Eurocash S.A. engages in the wholesale distribution of food and other fast moving consumer goods (FMCG) in Poland. The company operates through Wholesale, Retail, and Projects segments. Its FMCG products include food products, soft drinks, alcoholic beverages, tobacco products, and household chemicals and cosmetics. The company markets its products to traditional retail stores, including small supermarkets, grocery stores, and specialized grocery stores; and kiosks, retail outlets, and convenience stores, restaurants, gas stations, hotel and café chains, and catering outlets. It operates a network of Cash & Carry warehouses; Delikatesy Centrum network supermarkets; Inmedio; and franchise and partner stores of Eurocash distribution. Eurocash S.A. was incorporated in 2014 and is based in Komorniki, Poland.

About Metro

Metro Inc., through its subsidiaries, operates as a retailer, franchisor, distributor, and manufacturer in the food and pharmaceutical sectors in Canada. The company operates supermarkets, discount, neighborhood, and specialty stores that provide fresh and grocery products, baked goods, prepared food products, meats, dairy products, fruits and vegetables, frozen food products, bakery products, delicatessen items, and pastries. It also manufactures ready-to-eat meals, salads, dips, pastries, pies, breads, and cakes; generic drugs under Pro Doc trademark; and provides online grocery shopping services. In addition, the company offers its private label food products under Irresistibles, Selection, Our Harvest Best, Lucky Koi, Life Smart, Adonis, Phoenicia, and Premiere Moisson brands; and private label drug products comprising beauty and cosmetic products, over-the-counter medications, and personal care products, sold under the Personnelle brand name. It operates a network of food stores under various banners, including Metro, Metro Plus, Adonis, Super C, Marché Richelieu, Marché Ami, Première Moisson, Les 5 Saisons, and Food Basics, as well as drugstores primarily under the PJC Jean Coutu, PJC Santé, PJC Santé Beauté, Brunet, Brunet Plus, Brunet Clinique, Clini Plus, Metro Pharmacy, and Food Basics Pharmacy banners. The company was founded in 1947 and is headquartered in Montréal, Canada.