Chuy's (NASDAQ: CHUY) and Restaurant Brands International (NYSE:QSR) are both retail/wholesale companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, dividends, valuation, profitability, risk, earnings and institutional ownership.

Volatility & Risk

Chuy's has a beta of 0.02, meaning that its stock price is 98% less volatile than the S&P 500. Comparatively, Restaurant Brands International has a beta of 1.69, meaning that its stock price is 69% more volatile than the S&P 500.

Earnings & Valuation

This table compares Chuy's and Restaurant Brands International’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Chuy's $330.61 million 1.34 $17.24 million $0.91 28.74
Restaurant Brands International $4.15 billion 3.53 $615.60 million $1.45 42.44

Restaurant Brands International has higher revenue and earnings than Chuy's. Chuy's is trading at a lower price-to-earnings ratio than Restaurant Brands International, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Chuy's and Restaurant Brands International, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Chuy's 0 6 2 0 2.25
Restaurant Brands International 0 4 13 0 2.76

Chuy's presently has a consensus target price of $26.00, suggesting a potential downside of 0.57%. Restaurant Brands International has a consensus target price of $69.60, suggesting a potential upside of 13.10%. Given Restaurant Brands International’s stronger consensus rating and higher possible upside, analysts clearly believe Restaurant Brands International is more favorable than Chuy's.

Dividends

Restaurant Brands International pays an annual dividend of $0.80 per share and has a dividend yield of 1.3%. Chuy's does not pay a dividend. Restaurant Brands International pays out 55.2% of its earnings in the form of a dividend.

Insider and Institutional Ownership

95.8% of Chuy's shares are held by institutional investors. Comparatively, 78.4% of Restaurant Brands International shares are held by institutional investors. 3.3% of Chuy's shares are held by company insiders. Comparatively, 3.1% of Restaurant Brands International shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Chuy's and Restaurant Brands International’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Chuy's 4.37% 9.98% 6.52%
Restaurant Brands International 12.40% 23.53% 4.12%

Summary

Restaurant Brands International beats Chuy's on 12 of the 16 factors compared between the two stocks.

About Chuy's

Chuy’s Holdings, Inc. operates Chuy’s, a restaurant concept offering a distinct menu of authentic, freshly prepared Mexican and Tex-Mex inspired food. As of December 25, 2016, the Company operated 80 Chuy’s restaurants across 16 states. The Company offers the same menu during lunch and dinner, which includes enchiladas, fajitas, tacos, burritos, combination platters and daily specials, complemented by a range of appetizers, soups and salads. Each of the Company’s restaurants offers a range of homemade sauces, including the signature Hatch green chile and creamy jalapeno sauces. The Company also offers a full-service bar in all of its restaurants providing its customers a range of beverage offerings, featuring a selection of specialty cocktails including its signature on-the-rocks margaritas made with fresh, hand-squeezed lime juice, and the Texas Martini, a made-to-order, hand-shaken cocktail served with jalapeno-stuffed olives.

About Restaurant Brands International

Restaurant Brands International Inc. is a quick service restaurant (QSR) company. The Company had over 20,000 restaurants in more than 100 countries and the United States territories, as of December 31, 2016. It operates through two segments: Tim Hortons (TH) and Burger King (BK). Tim Hortons restaurants are quick service restaurants with a menu that includes blend coffee, tea, espresso-based hot and cold specialty drinks, baked goods, including donuts, Timbits, bagels, muffins, cookies and pastries, grilled paninis, classic sandwiches, wraps and soups, among others. Burger King restaurants are quick service restaurants that feature flame-grilled hamburgers, chicken and other specialty sandwiches, French fries, soft drinks and other food items. The Company operates coffee roasting facilities in Hamilton, Ontario and Rochester, New York. The Company sells its raw materials and supplies, including coffee, sugar, paper goods and other restaurant supplies to Tim Hortons restaurants.

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