DAVIDsTEA (NASDAQ: DTEA) and SuperValu (NYSE:SVU) are both small-cap consumer staples companies, but which is the better investment? We will contrast the two companies based on the strength of their profitabiliy, earnings, dividends, analyst recommendations, risk, valuation and institutional ownership.
Insider and Institutional Ownership
22.9% of DAVIDsTEA shares are owned by institutional investors. Comparatively, 80.4% of SuperValu shares are owned by institutional investors. 1.5% of SuperValu shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
This is a breakdown of current ratings for DAVIDsTEA and SuperValu, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
DAVIDsTEA currently has a consensus target price of $6.75, indicating a potential upside of 4.65%. SuperValu has a consensus target price of $5.33, indicating a potential upside of 65.63%. Given SuperValu’s stronger consensus rating and higher probable upside, analysts clearly believe SuperValu is more favorable than DAVIDsTEA.
This table compares DAVIDsTEA and SuperValu’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Risk and Volatility
DAVIDsTEA has a beta of 0.82, indicating that its stock price is 18% less volatile than the S&P 500. Comparatively, SuperValu has a beta of 2.05, indicating that its stock price is 105% more volatile than the S&P 500.
Valuation & Earnings
This table compares DAVIDsTEA and SuperValu’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|SuperValu||$12.48 billion||0.07||$482.00 million||$2.42||1.33|
SuperValu has higher revenue and earnings than DAVIDsTEA. DAVIDsTEA is trading at a lower price-to-earnings ratio than SuperValu, indicating that it is currently the more affordable of the two stocks.
SuperValu beats DAVIDsTEA on 10 of the 12 factors compared between the two stocks.
DAVIDsTEA Company Profile
DAVIDsTEA Inc. is engaged in the retail and online sale of tea, tea accessories, and food and beverages in Canada and in the United States. The Company’s segments include Canada and the U.S. The Company is a branded retailer of specialty tea, offering approximately 150 loose-leaf teas, pre-packaged teas, tea sachets and tea-related gifts, accessories, and food and beverages primarily through approximately 190 DAVIDsTEA stores, which are operated by the Company, and its Website, davidstea.com. Additionally, the Company offers on-the-go tea beverages in its retail stores. The Company’s tea accessories include tea mugs, travel mugs, teacup sets, teapots, tea makers, kettles, infusers, filters, frothers, tins and spoons. The Company offers beverages range from the standard hot or iced tea to its Tea Lattes. The Company’s different flavors of loose-leaf tea span eight tea categories: white, green, oolong, black, pu’erh, mate, rooibos and herbal tea.
SuperValu Company Profile
Supervalu Inc. is a wholesale distributor to independent retail customers across the United States. The Company’s segments include Wholesale and Retail. The Company offers a range of advertised brand name and private-label products, including grocery (both perishable and nonperishable), general merchandise and home, health and beauty care, and pharmacy, which are sold through Company-operated and licensed Retail stores to shoppers and through its Wholesale segment to independent retail customers. The Company’s Wholesale segment provides wholesale distribution of products to independent retail customers. Wholesale is organized and operated through two geographic regions: East and West. As of February 27, 2016, the Company conducted its Retail operations through a total of 200 stores primarily organized under five regionally-based retail banners of Cub Foods, Shoppers Food & Pharmacy, Shop ‘n Save, Farm Fresh and Hornbacher’s, as well as two Rainbow and two County Market stores.
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