Local Bounti (NYSE:LOCL) & Mission Produce (NASDAQ:AVO) Critical Review

Mission Produce (NASDAQ:AVO) and Local Bounti (NYSE:LOCL) are both small-cap consumer staples companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, earnings, dividends, risk, profitability, analyst recommendations and institutional ownership.

Profitability

This table compares Mission Produce and Local Bounti’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Mission Produce	2.48%	8.24%	5.00%
Local Bounti	-195.14%	N/A	-22.18%

Institutional & Insider Ownership

63.6% of Mission Produce shares are held by institutional investors. Comparatively, 28.0% of Local Bounti shares are held by institutional investors. 30.9% of Mission Produce shares are held by insiders. Comparatively, 19.8% of Local Bounti shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Mission Produce and Local Bounti”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Mission Produce	$1.39 billion	0.73	$37.70 million	$0.46	31.07
Local Bounti	$48.37 million	0.72	-$94.38 million	($7.51)	-0.21

Mission Produce has higher revenue and earnings than Local Bounti. Local Bounti is trading at a lower price-to-earnings ratio than Mission Produce, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent recommendations for Mission Produce and Local Bounti, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Mission Produce	0	2	3	1	2.83
Local Bounti	1	0	0	0	1.00

Mission Produce currently has a consensus target price of $17.00, indicating a potential upside of 18.96%. Given Mission Produce’s stronger consensus rating and higher possible upside, equities analysts plainly believe Mission Produce is more favorable than Local Bounti.

Volatility & Risk

Mission Produce has a beta of 0.63, indicating that its stock price is 37% less volatile than the S&P 500. Comparatively, Local Bounti has a beta of 2.17, indicating that its stock price is 117% more volatile than the S&P 500.

Summary

Mission Produce beats Local Bounti on 14 of the 15 factors compared between the two stocks.

About Mission Produce

Mission Produce, Inc. engages in the sourcing, farming, packaging, marketing, and distribution of avocados, mangoes, and blueberries to food retailers, distributors, and foodservice customers in the United States and internationally. The company operates through three segments, Marketing and Distribution; International Farming; and Blueberries. It also provides ripening, bagging, custom packing, logistical management, and quality assurance services. In addition, the company offers merchandising and promotional support, and insights on market trends, and training services. Mission Produce, Inc. was founded in 1983 and is headquartered in Oxnard, California.

About Local Bounti

Local Bounti Corporation grows and packs fresh greens in the United States. It produces lettuce, herbs, and loose-leaf lettuce. The company sells its products to food retailers and food service distributors. Local Bounti Corporation was founded in 2018 and is headquartered in Hamilton, Montana.