Critical Review: Pernod Ricard (OTCMKTS:PRNDY) versus MGP Ingredients (NASDAQ:MGPI)

MGP Ingredients (NASDAQ:MGPI) and Pernod Ricard (OTCMKTS:PRNDY) are both consumer staples companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, profitability, institutional ownership, earnings, dividends, risk and analyst recommendations.

Volatility and Risk

MGP Ingredients has a beta of 0.47, suggesting that its share price is 53% less volatile than the S&P 500. Comparatively, Pernod Ricard has a beta of 0.5, suggesting that its share price is 50% less volatile than the S&P 500.

Institutional and Insider Ownership

77.1% of MGP Ingredients shares are owned by institutional investors. 31.7% of MGP Ingredients shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Dividends

MGP Ingredients pays an annual dividend of $0.48 per share and has a dividend yield of 2.7%. Pernod Ricard pays an annual dividend of $0.75 per share and has a dividend yield of 4.7%. MGP Ingredients pays out -4.3% of its earnings in the form of a dividend.

Analyst Recommendations

This is a summary of current ratings and target prices for MGP Ingredients and Pernod Ricard, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
MGP Ingredients	1	2	3	0	2.33
Pernod Ricard	2	0	0	1	2.00

MGP Ingredients presently has a consensus target price of $27.25, suggesting a potential upside of 53.78%. Given MGP Ingredients’ stronger consensus rating and higher probable upside, analysts clearly believe MGP Ingredients is more favorable than Pernod Ricard.

Profitability

This table compares MGP Ingredients and Pernod Ricard’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
MGP Ingredients	-48.08%	7.41%	4.32%
Pernod Ricard	N/A	N/A	N/A

Earnings & Valuation

This table compares MGP Ingredients and Pernod Ricard”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
MGP Ingredients	$536.38 million	0.71	-$107.81 million	($11.26)	-1.57
Pernod Ricard	$11.93 billion	1.69	$1.77 billion	N/A	N/A

Pernod Ricard has higher revenue and earnings than MGP Ingredients.

Summary

MGP Ingredients beats Pernod Ricard on 8 of the 15 factors compared between the two stocks.

About MGP Ingredients

MGP Ingredients, Inc., together with its subsidiaries, engages in the production and supply of distilled spirits, branded spirits, and food ingredients in the United States and internationally. The company operates through three segments: Distillery Solutions; Branded Spirits; and Ingredient Solutions. The Distillery Solutions segment provides food grade alcohol for beverage applications that include bourbon, rye, whiskeys, as well as grain neutral spirits, include vodka and gin; and food-grade industrial alcohol, which is used as an ingredient in food products, personal care products, cleaning solutions, pharmaceuticals, and various other products. This segment also offers distillery co-products, such as dried distillers’ grain, fuel-grade alcohol for blending with gasoline, and corn oil; and provides warehouse services, including barrel put away, barrel storage, and barrel retrieval services, as well as blending services. The Branded Spirits segment provides premium plus, ultra-premium, super premium, premium, mid, and value branded distilled spirits, as well as private label products. The Ingredient Solutions segment provides specialty wheat starches for food applications under the Fibersym, Resistant Starch series, and FiberRite RW Resistant Starch names; specialty wheat proteins for food applications under the Arise and Proterra names; gluten-free textured pea proteins; commodity wheat starch for food and non-food applications; and commodity wheat proteins. It sells its products directly or through distributors to manufacturers and processors of finished packaged goods or to bakeries. The company was founded in 1941 and is based in Atchison, Kansas.

About Pernod Ricard

Pernod Ricard SA produces and sells wines and spirits worldwide. The company offers whiskey, vodka, gin, rum, liqueur and bitters, champagne, tequila and mezcal, and aperitif under the brands 100 Pipers, Aberlour, Absolut, Absolut Elyx, Altos, ARARAT, Augier, Avion, Ballantine's, Becherovka, Beefeater, Blenders Pride, Brancott Estate, Campo Viejo, Ceder's, Chivas, Church Road, Clan Campbell, Del Maguey, George Wyndham, Green Spot, Havana Club, Imperial, Imperial Blue, Italicus, J.P. Wiser's, Jacob's Creek, Jameson, Jefferson's, Kahlúa, Kenwood, KI NO BI, Lillet, Long John, L'Orbe, Lot No. 40, Malfy, Malibu, Martell, Method & Madness, Midleton Very Rare, Minttu, Monkey 47, Mumm, Olmeca, Ostoya, Passport Scotch, Pastis 51, Pernod, Perrier-Jouët, Plymouth Gin, Powers, Rabbit Hole, Ramazzotti, Redbreast, Ricard, Royal Salute, Royal Stag, Scapa, Seagram's Gin, Secret Speyside, Smooth Ambler, Something Special, St Hugo, Stoneleigh, Suze, The Glenlivet, TX, Wyborowa, and Ysios. It also provides non-alcoholic beverages under the brands Ceder's, Suze Tonic 0%, Cinzano Spritz 0%, Pacific, Campo Viejo Sparkling 0%, and Jacob's Creek Unvined. Pernod Ricard SA was founded in 1805 and is headquartered in Paris, France.