Financial Analysis: Jerónimo Martins, SGPS (OTCMKTS:JRONY) & Shimano (OTCMKTS:SMNNY)

Jerónimo Martins, SGPS (OTCMKTS:JRONY) and Shimano (OTCMKTS:SMNNY) are both large-cap retail/wholesale companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, risk, analyst recommendations, earnings, dividends, profitability and institutional ownership.

Analyst Recommendations

This is a breakdown of recent ratings for Jerónimo Martins, SGPS and Shimano, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Jerónimo Martins, SGPS	0	1	0	0	2.00
Shimano	0	0	0	0	0.00

Risk & Volatility

Jerónimo Martins, SGPS has a beta of 0.84, meaning that its share price is 16% less volatile than the S&P 500. Comparatively, Shimano has a beta of 0.61, meaning that its share price is 39% less volatile than the S&P 500.

Earnings and Valuation

This table compares Jerónimo Martins, SGPS and Shimano”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Jerónimo Martins, SGPS	$33.12 billion	0.47	$819.30 million	$2.15	22.92
Shimano	$2.98 billion	4.28	$504.84 million	$0.45	32.31

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

Dividends

Jerónimo Martins, SGPS pays an annual dividend of $0.78 per share and has a dividend yield of 1.6%. Shimano pays an annual dividend of $0.12 per share and has a dividend yield of 0.8%. Jerónimo Martins, SGPS pays out 36.3% of its earnings in the form of a dividend. Shimano pays out 26.7% 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.

Profitability

This table compares Jerónimo Martins, SGPS and Shimano’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Jerónimo Martins, SGPS	1.94%	21.07%	4.49%
Shimano	16.84%	9.02%	8.31%

Institutional & Insider Ownership

0.0% of Shimano shares are owned by institutional investors. 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.

Summary

Jerónimo Martins, SGPS beats Shimano on 7 of the 13 factors compared between the two stocks.

About Jerónimo Martins, SGPS

Jerónimo Martins, SGPS, S.A. operates in the food distribution and specialized retail sectors in Portugal, Poland, and Colombia. The company operates through Portugal Retail; Portugal Cash & Carry; Poland Retail; Colombia Retail; and Others, Eliminations and Adjustments segments. It operates food stores under the Biedronka name; and a chain of health and beauty stores under the Hebe banner in Poland, as well as food stores under the Ara name in Colombia. The company also operates supermarkets under the Pingo Doce banner; and cash and carry stores under the Recheio name in Portugal, and under the Bodega del Canasto name in Colombia. In addition, it operates restaurants under the Pingo Doce name; para-pharmacies and petrol stations under Bem-Estar brand; and clothing under Code brand. Further, the company operates coffee shops and kiosks under the Jeronymo name; and chocolates and confectionary retail stores under Hussel name. Additionally, the company engages in human resources top management, real estate management and administration, training, and saline brackish waters aquaculture; wholesale of fruit and vegetables; retail management, consultancy, and logistics activities; purchase and sale of real estate; growing of crops and farming of animals; retail sale of health and beauty products; manufacture of milk and dairy products; rental of air transport equipment; and provision of business portfolio management, financial, and sea passenger water transport services. It is also involved in the trading and distribution of consumer goods; retail and wholesale of non-food products; other business support service activities; and provision of services in the area of wholesale and retail distribution. The company was founded in 1792 and is headquartered in Lisbon, Portugal. Jerónimo Martins, SGPS, S.A. operates as a subsidiary of Sociedade Francisco Manuel Dos Santos, S.G.P.S., S.A.

About Shimano

Shimano Inc. develops, produces, and distributes bicycle components, fishing tackles, and rowing equipment. It has operations in Japan, Asia, Europe, North America, Latin America, and Oceania. Shimano Inc. was founded in 1921 and is headquartered in Sakai, Japan.