UNITED vs United Spirits Which Is a Smarter Choice?

United and United Spirits are both leading companies in the liquor industry, but they differ significantly in terms of their size, market presence, and financial performance. United, the parent company of popular brands like Budweiser and Stella Artois, is a global giant with a solid track record of profitability. On the other hand, United Spirits, known for brands like McDowell's No.1 and Royal Challenge, operates primarily in the Indian market and has faced challenges in recent years. Investors looking to invest in the liquor industry should carefully consider the strengths and weaknesses of both companies before making a decision.

UNITED or United Spirits?

When comparing UNITED and United Spirits, 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 UNITED and United Spirits.

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. UNITED has a dividend yield of 3.03%, while United Spirits has a dividend yield of 0.33%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. UNITED reports a 5-year dividend growth of 6.43% year and a payout ratio of 0.00%. On the other hand, United Spirits reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%.

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 UNITED P/E ratio at 51.06 and United Spirits's P/E ratio at 75.70. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. UNITED P/B ratio is 1.39 while United Spirits's P/B ratio is 14.06.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, UNITED has seen a 5-year revenue growth of -0.46%, while United Spirits's is 0.22%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with UNITED's ROE at 2.56% and United Spirits's ROE at 26.30%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are ¥789.00 for UNITED and ₹1500.55 for United Spirits. Over the past year, UNITED's prices ranged from ¥670.00 to ¥953.00, with a yearly change of 42.24%. United Spirits's prices fluctuated between ₹1043.35 and ₹1648.40, with a yearly change of 57.99%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.