Financial Analysis: Nomad Foods (NYSE:NOMD) & Mama’s Creations (NASDAQ:MAMA)

Nomad Foods (NYSE:NOMD) and Mama’s Creations (NASDAQ:MAMA) are both small-cap consumer staples companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, profitability, valuation, analyst recommendations, dividends, earnings and institutional ownership.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Nomad Foods and Mama’s Creations, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Nomad Foods	2	1	3	0	2.17
Mama’s Creations	0	0	5	1	3.17

Nomad Foods presently has a consensus target price of $12.50, suggesting a potential upside of 28.53%. Mama’s Creations has a consensus target price of $18.80, suggesting a potential upside of 27.98%. Given Nomad Foods’ higher possible upside, analysts plainly believe Nomad Foods is more favorable than Mama’s Creations.

Risk & Volatility

Nomad Foods has a beta of 0.74, indicating that its stock price is 26% less volatile than the S&P 500. Comparatively, Mama’s Creations has a beta of 0.72, indicating that its stock price is 28% less volatile than the S&P 500.

Profitability

This table compares Nomad Foods and Mama’s Creations’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Nomad Foods	4.50%	9.83%	3.95%
Mama’s Creations	3.06%	15.31%	8.85%

Earnings & Valuation

This table compares Nomad Foods and Mama’s Creations”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Nomad Foods	$3.43 billion	0.40	$154.66 million	$1.02	9.53
Mama’s Creations	$171.71 million	3.48	$5.29 million	$0.12	122.42

Nomad Foods has higher revenue and earnings than Mama’s Creations. Nomad Foods is trading at a lower price-to-earnings ratio than Mama’s Creations, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

75.3% of Nomad Foods shares are owned by institutional investors. Comparatively, 45.2% of Mama’s Creations shares are owned by institutional investors. 6.5% of Mama’s Creations shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Summary

Mama’s Creations beats Nomad Foods on 8 of the 15 factors compared between the two stocks.

About Nomad Foods

Nomad Foods Limited, together with its subsidiaries, manufactures, markets, and distributes a range of frozen food products in the United Kingdom and internationally. The company offers frozen fish products, including fish fingers, coated fish, and natural fish; ready-to-cook vegetable products, such as peas and spinach; and frozen poultry and meat products comprising nuggets, grills, and burgers. It also provides meal products that include ready-to-cook noodles, pasta, lasagna, pancakes, and other ready-made meals; ice creams, such as in-home and out-of-home ice creams; and other products consisting of soups, pizzas, bakery goods, and meat substitutes. The company sells its products to supermarkets and food retail chains primarily under the Birds Eye, Green Cuisine, iglo, Findus, Aunt Bessie's, Goodfella's, Frikom, Ledo, La Cocinera, and Belviva brand names. Nomad Foods Limited was founded in 2014 and is headquartered in Feltham, the United Kingdom.

About Mama’s Creations

Mama’s Creations, Inc. engages in the marketing, manufacturing, and distribution of beef meatballs with sauce, turkey meatballs with sauce, beef meat loaf, sausage and peppers, chicken parmesan, and other similar meats and sauces. Its products include beef meatballs, turkey meatballs, stuffed meatballs, lasagna roll ups, retail ready meals, bulk deli, single-size pasta bowls, and packaged refrigerated products. Its brands include MamaMancini’s, Creative Salads, and The Olive Branch. The company was founded by Daniel Dougherty on July 22, 2009 and is headquartered in East Rutherford, NJ.