Head to Head Analysis: Companhia Brasileira de Distribuicao (CBD) vs. Safeway (NYSE:SWY)

Safeway (NYSE: SWY) and Companhia Brasileira de Distribuicao (NYSE:CBD) are both mid-cap non-cyclical consumer goods & services companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, valuation, dividends, profitability, analyst recommendations, institutional ownership and risk.

Dividends

Companhia Brasileira de Distribuicao pays an annual dividend of $0.32 per share and has a dividend yield of 1.4%. Safeway does not pay a dividend. Companhia Brasileira de Distribuicao pays out 103.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Risk and Volatility

Safeway has a beta of 1.09, indicating that its stock price is 9% more volatile than the S&P 500. Comparatively, Companhia Brasileira de Distribuicao has a beta of 1.84, indicating that its stock price is 84% more volatile than the S&P 500.

Valuation and Earnings

This table compares Safeway and Companhia Brasileira de Distribuicao’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Safeway N/A N/A N/A $0.12 292.50
Companhia Brasileira de Distribuicao $11.95 billion 0.52 -$138.18 million $0.31 75.32

Safeway has higher earnings, but lower revenue than Companhia Brasileira de Distribuicao. Companhia Brasileira de Distribuicao is trading at a lower price-to-earnings ratio than Safeway, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Safeway and Companhia Brasileira de Distribuicao’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Safeway -0.26% -1.66% -0.69%
Companhia Brasileira de Distribuicao 0.64% 6.47% 1.97%

Analyst Recommendations

This is a breakdown of current ratings and price targets for Safeway and Companhia Brasileira de Distribuicao, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Safeway 0 0 0 0 N/A
Companhia Brasileira de Distribuicao 0 0 2 0 3.00

Insider and Institutional Ownership

3.3% of Companhia Brasileira de Distribuicao shares are owned by institutional investors. 0.0% of Companhia Brasileira de Distribuicao shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Summary

Companhia Brasileira de Distribuicao beats Safeway on 10 of the 12 factors compared between the two stocks.

Safeway Company Profile

Safeway Inc., is an food and drug retail company. The Company owns and operates GroceryWorks.com Operating Company, LLC, an online grocery channel doing business under the names Safeway.com and Vons.com. Blackhawk, a majority-owned subsidiary of Safeway, is a prepaid payment network utilizing proprietary technology to offer gift cards, other prepaid products and payment services. Blackhawk’s payment network supports its three primary constituents: consumers who purchase the products and services Blackhawk offers, content providers who offer branded products that are redeemable for goods and services, and distribution partners who sell the products. Blackhawk’s product offerings include gift cards, prepaid telecom products and prepaid financial services products, including general purpose reloadable cards and Blackhawk’s reload network.

Companhia Brasileira de Distribuicao Company Profile

Companhia Brasileira de Distribuicao, directly or through its subsidiaries, is engaged in the retail of food, clothing, home appliances, electronics and other items through its chain of hypermarkets, supermarkets, specialized stores and department stores principally under the trade names Pao de Acucar, Minuto Pao de Acucar, Extra Hiper, Extra Super, Minimercado Extra, Assai an the neighborhood shopping mall brand Conviva. The Company’s segments include Retail, and Cash and carry segment. The Company’s Retail segment includes the banners Pao de Acucar, Minuto Pao de Acucar, Extra Hiper, Extra Supermercado, Minimercado Extra, Posto Extra, Drogaria Extra and GPA Malls & Properties. Its Cash & Carry segment includes the brand Assai. The Company is engaged in operations of retail stores located in approximately 20 states and the Federal District of Brazil.

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