Financial Analysis: Companhia Brasileira de Distribuicao (CBD) & Metro (MTRAF)

Companhia Brasileira de Distribuicao (NYSE: CBD) and Metro (OTCMKTS:MTRAF) are both mid-cap retail/wholesale companies, but which is the better stock? We will contrast the two businesses based on the strength of their risk, earnings, valuation, institutional ownership, dividends, analyst recommendations and profitability.

Analyst Recommendations

This is a breakdown of current ratings for Companhia Brasileira de Distribuicao and Metro, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Companhia Brasileira de Distribuicao 0 0 4 0 3.00
Metro 0 0 0 0 N/A

Dividends

Companhia Brasileira de Distribuicao pays an annual dividend of $0.29 per share and has a dividend yield of 1.3%. Metro does not pay a dividend. Companhia Brasileira de Distribuicao pays out 63.0% of its earnings in the form of a dividend.

Valuation and Earnings

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

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Companhia Brasileira de Distribuicao $13.99 billion 0.42 $193.87 million $0.46 47.74
Metro N/A N/A N/A N/A N/A

Companhia Brasileira de Distribuicao has higher revenue and earnings than Metro.

Institutional and Insider Ownership

2.9% 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 will outperform the market over the long term.

Profitability

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

Net Margins Return on Equity Return on Assets
Companhia Brasileira de Distribuicao 1.41% 6.30% 1.88%
Metro N/A N/A N/A

Volatility and Risk

Companhia Brasileira de Distribuicao has a beta of 1.71, suggesting that its stock price is 71% more volatile than the S&P 500. Comparatively, Metro has a beta of 0.54, suggesting that its stock price is 46% less volatile than the S&P 500.

Summary

Companhia Brasileira de Distribuicao beats Metro on 9 of the 10 factors compared between the two stocks.

Companhia Brasileira de Distribuicao Company Profile

Companhia Brasileira de Distribuição engages in the retail of food, clothing, home appliances, electronics, and other products through its chain of hypermarkets, supermarkets, specialized stores, and department stores in Brazil. The company operates through two segments, Food Retail; and Cash and Carry. The Food retail segment sells non-perishable food products, beverages, fruits, vegetables, meat, breads, cold cuts, dairy products, cleaning products, disposable products, and personal care products; and non-food products, such as clothing items, baby items, shoes and accessories, household articles, books, magazines, CDs and DVDs, stationery, handcrafts, toys, sports and camping gears, furniture, mobile phones, mattresses, pet products, and gardening products, as well as electronic products, including personal computers, software, computer accessories, and sound and image systems. This segment also offers medications and cosmetics at its drugstores; and non-food products at gas stations, as well as rents commercial spaces. It operates its supermarkets under the banners of Pão de Açúcar and Extra Supermercado; hypermarkets under the banner of Extra Hiper; and neighborhood stores under the banners of Minimercado Extra, Minuto Pão de Açúcar, and Aliados Compre Bem; and gas stations and drugstores under the banner of Extrabanner, as well as sells its products through its Websites, paodeacucar.com and extra.com.br. The Cash and Carry segment sells grocery, food, perishable, beverage, wrapping, hygiene and cleaning products, and other products to resellers, intermediate consumers, retail customers, and small and mid-sized companies through the Assaí banner. As of December 31, 2017, the company operated 882 stores, 72 gas stations, and 127 drugstores, as well as 23 distribution centers and depots in Brazilian states and the Federal District. Companhia Brasileira de Distribuição was founded in 1948 and is headquartered in São Paulo, Brazil.

Metro Company Profile

Metro Inc. operates as a retailer and distributor in the food and pharmaceutical sectors in Canada. It operates supermarkets, discount and drug stores, and food stores that provide grocery products, general merchandise, non-perishable goods, dairy products, prepared meals, fruits and vegetables, meats, and frozen foods. The company also acts as a franchisor and distributor for 183 drugstores owned by independent pharmacists under the Brunet Plus, Brunet, Brunet Clinique, and Clini Plus brands. It operates a network of 335 supermarkets under the Metro and Metro Plus brands; 226 discount stores under the Super C and Food Basics names; 11 stores under the Adonis banner; and 73 drugstores under the Metro Pharmacy and Drug Basics banners. In addition, the company is involved in the sale of bakery, pastry, charcutery, and other food products under Première Moisson brand; and online sale of meal through MissFresh brand. Metro Inc. was founded in 1947 and is headquartered in Montréal, Canada.

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