Nestlé vs Unilever

Nestlé and Unilever are two of the largest and most well-known companies in the consumer goods industry, with a long history of competing for market share and shareholder value. Both companies have a global presence and a diverse portfolio of brands, ranging from food and beverages to personal care products. Investors often compare Nestlé and Unilever stocks due to their similar business models and focus on emerging markets. Understanding the key differences and strengths of each company can help investors make informed decisions when considering investing in their stocks.

Nestlé or Unilever?

When comparing Nestlé and Unilever, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Nestlé and Unilever.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Nestlé has a dividend yield of 6.05%, while Unilever has a dividend yield of 2.91%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Nestlé reports a 5-year dividend growth of 6.70% year and a payout ratio of 69.76%. On the other hand, Unilever reports a 5-year dividend growth of 0.22% year and a payout ratio of 64.35%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Nestlé P/E ratio at 19.54 and Unilever's P/E ratio at 22.06. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Nestlé P/B ratio is 6.67 while Unilever's P/B ratio is 7.21.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Nestlé has seen a 5-year revenue growth of 0.15%, while Unilever's is 0.24%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Nestlé's ROE at 32.67% and Unilever's ROE at 34.58%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $97.11 for Nestlé and $63.25 for Unilever. Over the past year, Nestlé's prices ranged from $96.36 to $117.55, with a yearly change of 21.99%. Unilever's prices fluctuated between $46.16 and $65.87, with a yearly change of 42.70%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.