Financial Contrast: Molson Coors Beverage (NYSE:TAP) & Brown Forman (NYSE:BF.A)

Brown Forman (NYSE:BF.A) and Molson Coors Beverage (NYSE:TAP) are both consumer staples companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, profitability, dividends, valuation and risk.

Risk & Volatility

Brown Forman has a beta of 0.4, indicating that its share price is 60% less volatile than the S&P 500. Comparatively, Molson Coors Beverage has a beta of 0.5, indicating that its share price is 50% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Brown Forman and Molson Coors Beverage, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Brown Forman	0	0	0	0	0.00
Molson Coors Beverage	4	11	4	0	2.00

Molson Coors Beverage has a consensus target price of $47.47, suggesting a potential upside of 11.79%. Given Molson Coors Beverage’s stronger consensus rating and higher possible upside, analysts clearly believe Molson Coors Beverage is more favorable than Brown Forman.

Dividends

Brown Forman pays an annual dividend of $0.92 per share and has a dividend yield of 3.2%. Molson Coors Beverage pays an annual dividend of $1.92 per share and has a dividend yield of 4.5%. Brown Forman pays out 53.5% of its earnings in the form of a dividend. Molson Coors Beverage pays out -17.7% 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. Molson Coors Beverage has raised its dividend for 4 consecutive years. Molson Coors Beverage is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings and Valuation

This table compares Brown Forman and Molson Coors Beverage”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Brown Forman	$3.98 billion	3.33	$869.00 million	$1.72	16.80
Molson Coors Beverage	$13.04 billion	0.61	-$2.14 billion	($10.85)	-3.91

Brown Forman has higher earnings, but lower revenue than Molson Coors Beverage. Molson Coors Beverage is trading at a lower price-to-earnings ratio than Brown Forman, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Brown Forman and Molson Coors Beverage’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Brown Forman	20.64%	19.93%	9.85%
Molson Coors Beverage	-16.41%	9.04%	4.40%

Institutional and Insider Ownership

3.8% of Brown Forman shares are owned by institutional investors. Comparatively, 78.5% of Molson Coors Beverage shares are owned by institutional investors. 4.0% of Brown Forman shares are owned by company insiders. Comparatively, 2.3% of Molson Coors Beverage shares are owned by company insiders. 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.

Summary

Molson Coors Beverage beats Brown Forman on 9 of the 17 factors compared between the two stocks.

About Brown Forman

Brown-Forman Corporation manufactures, bottles, imports, exports, markets, and sells various alcoholic beverages. It provides spirits, wines, whiskey spirits, whiskey-based flavored liqueurs, ready-to-drink and ready-to-pour products, ready-to-drink cocktails, vodkas, tequilas, champagnes, brandy, bourbons, and liqueurs. The company offers its products primarily under the Jack Daniel's, Woodford Reserve, Canadian Mist, GlenDronach, BenRiach, Glenglassaugh, Old Forester, Early Times, Slane Irish Whiskey, Coopers' Craft, el Jimador, Herradura, New Mix, Pepe Lopez, Antiguo, Finlandia, Korbel Champagne, and Sonoma-Cutrer brands. It is also involved in the sale of used barrels, bulk whiskey, and wine; and provision of contract bottling services. The company serves retail customers and consumers through distributors or state governments; and retailers, wholesalers, and provincial governments directly. It has operations in the United States, the United Kingdom, Germany, Australia, Mexico, and internationally. Brown-Forman Corporation was founded in 1870 and is headquartered in Louisville, Kentucky.

About Molson Coors Beverage

Molson Coors Beverage Company manufactures, markets, and sells beer and other malt beverage products under various brands in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. The company offers flavored malt beverages including hard seltzers, craft, spirits and energy, and ready to drink beverages. It provides its products under Aspall Cider, Blue Moon, Coors Original, Five Trail, Hop Valley brands, Leinenkugel’s, Madri, Miller Genuine Draft, Molson Ultra, Sharp’s, Staropramen, and Vizzy Hard Seltzer above premier brands; Bergenbier, Borsodi, Carling, Coors Banquet, Coors Light, Jelen, Kamenitza, Miller Lite, Molson Canadian, and Niksicko, Ozujsko under the premium brands; and Branik, Icehouse, Keystone, Miller High Life, Milwaukee’s Best, and Steel Reserve under the economy brands. The company was formerly known as Molson Coors Brewing Company and changed its name to Molson Coors Beverage Company in January 2020. Molson Coors Beverage Company was founded in 1774 and is based in Golden, Colorado.