Arko (NASDAQ:ARKO) and Seven & i (OTC:SVNDF) Head-To-Head Review

Seven & i (OTC:SVNDF) and Arko (NASDAQ:ARKO) are both consumer defensive 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

19.6% of Seven & i shares are held by institutional investors. Comparatively, 78.3% of Arko shares are held by institutional investors. 21.6% of Arko 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 Seven & i and Arko, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Seven & i	0	0	0	0	N/A
Arko	0	2	0	0	2.00

Arko has a consensus price target of $6.13, indicating a potential downside of 10.58%. Given Arko’s higher probable upside, analysts plainly believe Arko is more favorable than Seven & i.

Dividends

Seven & i pays an annual dividend of 57.09 per share and has a dividend yield of 383.2%. Arko pays an annual dividend of $0.12 per share and has a dividend yield of 1.8%. Seven & i pays out 28.8% of its earnings in the form of a dividend. Arko pays out 46.2% 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. Seven & i is clearly the better dividend stock, given its higher yield and lower payout ratio.

Valuation & Earnings

This table compares Seven & i and Arko”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Seven & i	N/A	N/A	N/A	197.96	0.08
Arko	$9.32 billion	0.09	$34.37 million	$0.26	26.35

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

Profitability

This table compares Seven & i and Arko’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Seven & i	N/A	N/A	N/A
Arko	0.39%	13.12%	0.98%

Summary

Arko beats Seven & i on 8 of the 11 factors compared between the two stocks.

About Seven & i

Seven & i Holdings Co., Ltd. operates convenience stores, superstores, department stores, supermarkets, and specialty stores. It operates through six segments: Domestic Convenience Store operations, Overseas Convenience Store Operations, Superstore Operations, Department and Specialty Store Operations, Financial Services, and Others. The company engages in the operation of convenience stores comprising directly managed corporate stores and franchised stores; retail business that provides daily life necessities, such as food and other daily necessities and dollar merchandise and services; banking, leasing, and credit card business; and real estate business. Seven & i Holdings Co., Ltd. was incorporated in 2005 and is headquartered in Tokyo, Japan.

About Arko

Arko Corp. operates convenience stores in the United States. It operates through Retail, Wholesale, Fleet Fueling, and GPMP segments. The Retail segment engages in the sale of fuel and merchandise to retail consumers. Its Wholesale segment supplies fuel to third-party dealers and consignment agents. The Fleet Fueling segment supplies fuel to proprietary and third-party cardlock, and issuance of proprietary fuel cards. Its GPMP segment supplies fuel to retail and wholesale segments. The company is based in Richmond, Virginia.