Tesco PLC (TSCO) or Wm. Morrison Supermarkets plc (MRW)? Which One To Buy

I think that both companies make attractive purchases at the moment, but I’m tempted to stick with Tesco (I’m already a shareholder) because of its size and far larger online and convenience store businesses — two major growth areas.

Wm. Morrison Supermarkets plc (LON:MRW) is planning to launch a home delivery service in partnership with Ocado by the end of Jan. 2014, but it’s too early to say how successful or profitable this will be.

The other aspect of Tesco’s business I really like is Tesco Bank. Although it only generated 1 billion pounds in revenue last year, it did so with a profit margin of 18.7% and now looks well positioned for future growth.

2013’s top income stock?
Despite the attractive incomes offered by Tesco and Morrisons, the U.K. utility sector remains one of the best places to find reliable, high-yielding income stocks.

The Motley Fool’s top analysts have looked closely at all of the listed U.K. utility companies and identified one FTSE 100 utility share that offers a 5.2% dividend yield and that they believe may be significantly undervalued.

The article Should I Buy Tesco or Wm. Morrison Supermarkets? originally appeared on Fool.com.

Roland Head has no position in any stocks mentioned. The Motley Fool recommends and owns shares of Tesco.

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