Coca-Cola FEMSA (NYSE:KOF) & Primo Brands (NYSE:PRMB) Head to Head Analysis

Coca-Cola FEMSA (NYSE:KOF) and Primo Brands (NYSE:PRMB) are both consumer staples companies, but which is the superior business? We will compare the two businesses based on the strength of their earnings, profitability, analyst recommendations, dividends, risk, valuation and institutional ownership.

Institutional and Insider Ownership

87.7% of Primo Brands shares are held by institutional investors. 1.0% of Coca-Cola FEMSA shares are held by company insiders. Comparatively, 2.5% of Primo Brands shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings and target prices for Coca-Cola FEMSA and Primo Brands, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Coca-Cola FEMSA	0	0	6	0	3.00
Primo Brands	0	0	1	0	3.00

Coca-Cola FEMSA presently has a consensus price target of $104.75, indicating a potential upside of 32.85%. Primo Brands has a consensus price target of $33.00, indicating a potential upside of 6.01%. Given Coca-Cola FEMSA’s higher probable upside, equities research analysts plainly believe Coca-Cola FEMSA is more favorable than Primo Brands.

Risk & Volatility

Coca-Cola FEMSA has a beta of 0.84, indicating that its stock price is 16% less volatile than the S&P 500. Comparatively, Primo Brands has a beta of 1.11, indicating that its stock price is 11% more volatile than the S&P 500.

Dividends

Coca-Cola FEMSA pays an annual dividend of $0.69 per share and has a dividend yield of 0.9%. Primo Brands pays an annual dividend of $0.36 per share and has a dividend yield of 1.2%. Coca-Cola FEMSA pays out 11.7% of its earnings in the form of a dividend. Primo Brands pays out 22.4% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Earnings and Valuation

This table compares Coca-Cola FEMSA and Primo Brands”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Coca-Cola FEMSA	$267.59 billion	0.50	$1.16 billion	$5.89	13.39
Primo Brands	$4.84 billion	1.03	$238.10 million	$1.61	19.34

Coca-Cola FEMSA has higher revenue and earnings than Primo Brands. Coca-Cola FEMSA is trading at a lower price-to-earnings ratio than Primo Brands, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Coca-Cola FEMSA and Primo Brands’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Coca-Cola FEMSA	8.12%	15.99%	7.55%
Primo Brands	13.63%	8.80%	3.62%

Summary

Coca-Cola FEMSA beats Primo Brands on 8 of the 15 factors compared between the two stocks.

About Coca-Cola FEMSA

Coca-Cola FEMSA, S.A.B. de C.V., a franchise bottler, produces, markets, sells, and distributes Coca-Cola trademark beverages in Mexico, Guatemala, Nicaragua, Costa Rica, Panama, Colombia, Brazil, Argentina, and Uruguay. The company offers sparkling beverages, including colas and flavored sparkling beverages; waters; other non-carbonated beverages comprising juice drinks, coffee, teas, milk, value-added dairy products, sports and energy drinks, and plant-based drinks; and alcoholic beverages, such as hard seltzer under the Topo Chico brand name. It also distributes and sells Heineken, Estrella Galicia, Therezópolis, and Campari beer products, as well as Perfetti confectionary and chewing gum in its Brazilian territories; and Monster products. The company sells its products to distributors, retail outlets, wholesale supermarkets, discount and convenience stores, retailers, points-of-sale outlets, restaurants, bars, stadiums, auditoriums, theaters, and home deliveries. Coca-Cola FEMSA, S.A.B. de C.V. was founded in 1979 and is headquartered in Mexico City, Mexico.

About Primo Brands

Primo Water Corporation is a leading pure-play water solutions provider in North America and Europe. Primo operates largely under a recurring razor/razorblade revenue model. The razor in Primo’s revenue model is its industry leading line-up of sleek and innovative water dispensers, which are sold through major retailers and online at various price points or leased to customers. The dispensers help increase household penetration, which drives recurring purchases of Primo’s razorblade offering. Primo’s razorblade offering is comprised of Water Direct, Water Exchange, and Water Refill. Primo’s water solutions expand consumer access to purified, spring and mineral water to promote a healthier, more sustainable lifestyle while simultaneously reducing plastic waste and pollution. Primo is committed to its water stewardship standards and is proud to partner with the International Bottled Water Association in North America as well as with Watercoolers Europe.