Head to Head Review: Good Times Restaurants (GTIM) vs. Darden Restaurants (DRI)
Good Times Restaurants (NASDAQ: GTIM) and Darden Restaurants (NYSE:DRI) are both retail/wholesale companies, but which is the better business? We will compare the two companies based on the strength of their risk, valuation, analyst recommendations, institutional ownership, profitability, dividends and earnings.
Insider & Institutional Ownership
32.7% of Good Times Restaurants shares are held by institutional investors. Comparatively, 89.6% of Darden Restaurants shares are held by institutional investors. 8.4% of Good Times Restaurants shares are held by insiders. Comparatively, 0.6% of Darden Restaurants shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
This is a breakdown of recent ratings and recommmendations for Good Times Restaurants and Darden Restaurants, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Good Times Restaurants||0||0||1||0||3.00|
Good Times Restaurants presently has a consensus price target of $6.00, suggesting a potential upside of 93.55%. Darden Restaurants has a consensus price target of $87.29, suggesting a potential upside of 5.46%. Given Good Times Restaurants’ stronger consensus rating and higher possible upside, research analysts plainly believe Good Times Restaurants is more favorable than Darden Restaurants.
This table compares Good Times Restaurants and Darden Restaurants’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Good Times Restaurants||-2.25%||-4.44%||-3.35%|
Valuation & Earnings
This table compares Good Times Restaurants and Darden Restaurants’ revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Good Times Restaurants||$73.71 million||0.52||$2.12 million||($0.14)||-22.14|
|Darden Restaurants||$7.39 billion||1.39||$975.90 million||$3.87||21.39|
Darden Restaurants has higher revenue and earnings than Good Times Restaurants. Good Times Restaurants is trading at a lower price-to-earnings ratio than Darden Restaurants, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Good Times Restaurants has a beta of 0.65, indicating that its stock price is 35% less volatile than the S&P 500. Comparatively, Darden Restaurants has a beta of 0.24, indicating that its stock price is 76% less volatile than the S&P 500.
Darden Restaurants pays an annual dividend of $2.52 per share and has a dividend yield of 3.0%. Good Times Restaurants does not pay a dividend. Darden Restaurants pays out 65.1% of its earnings in the form of a dividend.
Darden Restaurants beats Good Times Restaurants on 10 of the 15 factors compared between the two stocks.
Good Times Restaurants Company Profile
Good Times Restaurants Inc. operates and franchises Good Times Burgers & Frozen Custard (Good Times) restaurants and Bad Daddy’s Burger Bar concept (Bad Daddy’s). The Company operates through two segments: Good Times Burgers and Frozen Custard restaurants, and Bad Daddy’s Burger Bar restaurants. Good Times is a quick service restaurant concept. The menu of a Good Times restaurant includes hamburgers, cheeseburgers, chicken sandwiches, French fries, onion rings, soft drinks and frozen custard products. Its breakfast menu includes breakfast burritos, orange juice and coffee. Bad Daddy’s operates in the burger casual dining sector and is chef driven, full service, full bar concept. Its menu consists of burgers, salads, sandwiches and appetizers. Its bar focuses on local, craft microbrew beers and specialty cocktails. The Company operates through its subsidiaries, Good Times Drive Thru, Inc., BD of Colorado, LLC, Bad Daddy’s Franchise Development, LLC and Bad Daddy’s International, LLC.
Darden Restaurants Company Profile
Darden Restaurants, Inc. is a full-service restaurant company. The Company owned and operated 1,536 restaurants through its subsidiaries in the United States and Canada, as of May 29, 2016. The Company’s segments include Olive Garden, LongHorn Steakhouse, Fine Dining (which includes The Capital Grille, and Eddie V’s Prime Seafood and Wildfish Seafood Grille (Eddie V’s)) and Other Business (which includes Yard House, Seasons 52, Bahama Breeze, consumer-packaged goods and franchise revenues). As of May 29, 2016, the Company also had 50 restaurants operated by independent third parties pursuant to area development and franchise agreements. Olive Garden’s menu includes a range of authentic Italian foods featuring fresh ingredients and a selection of imported Italian wines. LongHorn Steakhouse restaurants feature a range of menu items, including fresh steaks and chicken, as well as salmon, shrimp, ribs, pork chops, burgers and prime rib.
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