Bloomin’ Brands (BLMN) vs. Luby’s (LUB) Critical Analysis
Bloomin’ Brands (NASDAQ: BLMN) and Luby’s (NYSE:LUB) are both small-cap retail/wholesale companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, institutional ownership, risk, valuation, earnings, profitability and analyst recommendations.
Volatility & Risk
Bloomin’ Brands has a beta of 0.54, meaning that its stock price is 46% less volatile than the S&P 500. Comparatively, Luby’s has a beta of 0.52, meaning that its stock price is 48% less volatile than the S&P 500.
Bloomin’ Brands pays an annual dividend of $0.32 per share and has a dividend yield of 1.9%. Luby’s does not pay a dividend. Bloomin’ Brands pays out 41.6% of its earnings in the form of a dividend.
This table compares Bloomin’ Brands and Luby’s’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Valuation and Earnings
This table compares Bloomin’ Brands and Luby’s’ gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Bloomin’ Brands||$4.25 billion||0.37||$41.74 million||$0.77||22.22|
|Luby’s||$376.03 million||0.20||-$23.26 million||($0.79)||-3.22|
Bloomin’ Brands has higher revenue and earnings than Luby’s. Luby’s is trading at a lower price-to-earnings ratio than Bloomin’ Brands, indicating that it is currently the more affordable of the two stocks.
This is a summary of recent ratings and target prices for Bloomin’ Brands and Luby’s, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Bloomin’ Brands presently has a consensus target price of $21.00, suggesting a potential upside of 22.74%. Given Bloomin’ Brands’ higher possible upside, analysts clearly believe Bloomin’ Brands is more favorable than Luby’s.
Insider and Institutional Ownership
42.7% of Luby’s shares are held by institutional investors. 7.0% of Bloomin’ Brands shares are held by insiders. Comparatively, 35.2% of Luby’s shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Bloomin’ Brands beats Luby’s on 11 of the 14 factors compared between the two stocks.
Bloomin’ Brands Company Profile
Bloomin’ Brands, Inc. is a holding company. The Company owns and operates casual, upscale casual and fine dining restaurants. The Company operates through two segments: U.S. and International. The U.S. segment includes all brands operating in the United States. The International segment includes brands operating outside the United States. As of December 25, 2016, the Company had a portfolio of four restaurant concepts: Outback Steakhouse, Carrabba’s Italian Grill, Bonefish Grill, and Fleming’s Prime Steakhouse & Wine Bar. OSI Restaurant Partners, LLC (OSI) is the Company’s primary operating entity. New Private Restaurant Properties, LLC (PRP), an indirect subsidiary of the Company, leases the Company-owned restaurant properties to OSI’s subsidiaries. As of December 25, 2016, the Company owned and operated 1,276 restaurants and franchised 240 restaurants across 48 states, Puerto Rico, Guam and 20 countries.
Luby’s Company Profile
Luby’s, Inc., is a multi-branded company operating in the restaurant industry and in the contract food services industry. The Company is managed through three segments: Company-owned restaurants, franchise operations, and Culinary Contract Services (CSS). The company-owned restaurants brands are Luby’s Cafeteria, Fuddruckers, and Cheeseburger in Paradise with a couple of non-core restaurant locations under other brand names. As of August 31, 2016, the Company owned and operated 175 restaurants, with 127 in Texas and the remainder in other states. The Company offers franchises for the Fuddruckers brand. As of August 31, 2016, the number of franchised restaurants were 113. Culinary Contract Services consists of contract arrangements to manage food services for clients operating in three lines of business: healthcare, higher education, and corporate dining. As of August 31, 2016, the Company had 24 Culinary Contract Services contracts.
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