Analyzing Delhaize Group SA (DEG) & DAVIDsTEA (DTEA)

Delhaize Group SA (NYSE: DEG) and DAVIDsTEA (NASDAQ:DTEA) are both non-cyclical consumer goods & services companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, institutional ownership, valuation, dividends, earnings and profitability.

Analyst Ratings

This is a summary of recent recommendations for Delhaize Group SA and DAVIDsTEA, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Delhaize Group SA 0 0 0 0 N/A
DAVIDsTEA 1 3 0 0 1.75

DAVIDsTEA has a consensus price target of $6.75, suggesting a potential upside of 58.82%. Given DAVIDsTEA’s higher probable upside, analysts clearly believe DAVIDsTEA is more favorable than Delhaize Group SA.

Valuation & Earnings

This table compares Delhaize Group SA and DAVIDsTEA’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Delhaize Group SA N/A N/A N/A $1.17 24.03
DAVIDsTEA $164.02 million 0.75 -$4.83 million ($0.26) -16.35

Delhaize Group SA has higher revenue, but lower earnings than DAVIDsTEA. DAVIDsTEA is trading at a lower price-to-earnings ratio than Delhaize Group SA, indicating that it is currently the more affordable of the two stocks.

Dividends

Delhaize Group SA pays an annual dividend of $0.35 per share and has a dividend yield of 1.2%. DAVIDsTEA does not pay a dividend. Delhaize Group SA pays out 29.9% of its earnings in the form of a dividend.

Profitability

This table compares Delhaize Group SA and DAVIDsTEA’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Delhaize Group SA 1.77% 7.11% 3.43%
DAVIDsTEA -3.98% 1.51% 1.19%

Institutional & Insider Ownership

9.4% of DAVIDsTEA shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

Delhaize Group SA beats DAVIDsTEA on 5 of the 9 factors compared between the two stocks.

Delhaize Group SA Company Profile

Delhaize le Lion de Leeuw BV (Belgium Branch), formerly Delhaize Group SA, is a Belgium-based food retailer. The Company operates through three segments: the United States, including Food Lion and Hannaford banners; Belgium, including Delhaize Le Lion and AD Delhaize banners, and Southeastern Europe (SEE), including Alfa Beta, Mega Image and Shop&Go banners. The Company is principally engaged in the operation of food supermarkets through Company-operated, affiliated and franchised stores. Affiliated stores are with its banners that are operated by independent third parties to whom the Company sells its products at wholesale prices. Its store network also includes other store formats, such as proximity, cash and carry, and specialty stores. The Company has stores located in the United States (Northeast, Southeast and Mid-Atlantic), Belgium, Luxembourg, Greece, Serbia, Romania and Indonesia. The Company operates over 3,510 stores.

DAVIDsTEA Company Profile

DAVIDsTEA Inc. is engaged in the retail and online sale of tea, tea accessories, and food and beverages in Canada and in the United States. The Company’s segments include Canada and the U.S. The Company is a branded retailer of specialty tea, offering approximately 150 loose-leaf teas, pre-packaged teas, tea sachets and tea-related gifts, accessories, and food and beverages primarily through approximately 190 DAVIDsTEA stores, which are operated by the Company, and its Website, davidstea.com. Additionally, the Company offers on-the-go tea beverages in its retail stores. The Company’s tea accessories include tea mugs, travel mugs, teacup sets, teapots, tea makers, kettles, infusers, filters, frothers, tins and spoons. The Company offers beverages range from the standard hot or iced tea to its Tea Lattes. The Company’s different flavors of loose-leaf tea span eight tea categories: white, green, oolong, black, pu’erh, mate, rooibos and herbal tea.

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