Analyzing Brambles (OTCMKTS:BMBLF) and Aramark (NYSE:ARMK)

Brambles (OTCMKTS:BMBLF) and Aramark (NYSE:ARMK) are both industrials companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, analyst recommendations, valuation, earnings, institutional ownership, profitability and dividends.

Dividends

Brambles pays an annual dividend of $0.14 per share and has a dividend yield of 1.1%. Aramark pays an annual dividend of $0.38 per share and has a dividend yield of 1.0%. Brambles pays out 15.7% of its earnings in the form of a dividend. Aramark pays out 16.0% 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. Brambles is clearly the better dividend stock, given its higher yield and lower payout ratio.

Valuation and Earnings

This table compares Brambles and Aramark”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Brambles	N/A	N/A	N/A	$0.86	14.28
Aramark	$19.95 billion	0.51	$674.11 million	$2.38	16.40

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

Insider & Institutional Ownership

31.2% of Brambles shares are held by institutional investors. 1.9% of Aramark shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Brambles and Aramark’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Brambles	N/A	N/A	N/A
Aramark	1.93%	14.09%	3.21%

Analyst Ratings

This is a breakdown of recent ratings and target prices for Brambles and Aramark, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Brambles	0	0	0	0	N/A
Aramark	0	2	9	0	2.82

Aramark has a consensus target price of $38.95, suggesting a potential downside of 0.19%. Given Aramark’s higher probable upside, analysts clearly believe Aramark is more favorable than Brambles.

Summary

Aramark beats Brambles on 9 of the 12 factors compared between the two stocks.

About Brambles

Brambles Limited operates as a supply-chain logistics company. It operates through CHEP North America and Latin America; CHEP Europe, Middle East, Africa and India; and CHEP Australia, New Zealand and Asia, excluding India segments. The company engages in the pooling of unit-load equipment and associated services, focusing on the outsourced management of pallets, crates, and containers. It serves customers in the fast-moving consumer goods, fresh produce, beverage, retail, and general manufacturing industries. Brambles Limited was founded in 1875 and is based in Sydney, Australia.

About Aramark

Aramark provides food and facilities services to education, healthcare, business and industry, sports, leisure, and corrections clients in the United States and internationally. It operates through two segments, Food and Support Services United States, and Food and Support Services International. The company offers food-related managed services, including dining, catering, food service management, and convenience-oriented retail services; non-clinical food and food-related support services, such as patient food and nutrition, retail food, environmental services, and procurement services; and plant operations and maintenance, custodial/housekeeping, energy management, grounds keeping, and capital project management services. It also provides on-site restaurants, catering, convenience stores, and executive dining services; beverage and vending services; and facility management services comprising landscaping, transportation, capital program management, payment services, and other facility consulting services relating to building operations. In addition, the company offers concessions, banquet, and catering services; retail services and merchandise sale, recreational, and lodging services; and facility management services at sports, entertainment, and recreational facilities. Further, it offers correctional food; and operates commissaries, laundry facilities, and property rooms. It primarily serves business and industry, sports, leisure and corrections, education, healthcare, public institutions, manufacturing, transportation, service, and other industries. The company was formerly known as ARAMARK Holdings Corporation. Aramark was founded in 1959 and is based in Philadelphia, Pennsylvania.