Denny's (DENN) versus One Group Hospitality (STKS) Financial Analysis
Denny's (NASDAQ: DENN) and One Group Hospitality (NASDAQ:STKS) are both small-cap cyclical consumer goods & services companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, risk, earnings, valuation, analyst recommendations, institutional ownership and profitability.
Institutional & Insider Ownership
91.0% of Denny's shares are held by institutional investors. Comparatively, 14.5% of One Group Hospitality shares are held by institutional investors. 5.2% of Denny's shares are held by insiders. Comparatively, 35.9% of One Group Hospitality shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
This table compares Denny's and One Group Hospitality’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Denny's||$506.95 million||1.89||$19.40 million||$0.52||28.17|
|One Group Hospitality||$72.41 million||0.78||-$16.68 million||($0.79)||-2.82|
Denny's has higher revenue and earnings than One Group Hospitality. One Group Hospitality is trading at a lower price-to-earnings ratio than Denny's, indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
Denny's has a beta of 0.67, indicating that its stock price is 33% less volatile than the S&P 500. Comparatively, One Group Hospitality has a beta of 1.55, indicating that its stock price is 55% more volatile than the S&P 500.
This is a summary of recent recommendations for Denny's and One Group Hospitality, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|One Group Hospitality||0||0||0||0||N/A|
Denny's presently has a consensus price target of $12.67, suggesting a potential downside of 13.54%. Given Denny's’ higher probable upside, equities analysts plainly believe Denny's is more favorable than One Group Hospitality.
This table compares Denny's and One Group Hospitality’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|One Group Hospitality||-25.48%||-68.30%||-7.44%|
Denny's beats One Group Hospitality on 11 of the 13 factors compared between the two stocks.
Denny's Company Profile
Denny’s Corporation (Denny’s) operates a franchised full-service restaurant chain. The Company, through its subsidiary, Denny’s, Inc., owns and operates the Denny’s brand. As of December 28, 2016, the Denny’s brand consisted of 1,733 franchised, licensed and Company-operated restaurants around the world, including 1,610 restaurants in the United States and 123 international locations. As of December 28, 2016, 1,564 of its restaurants were franchised or licensed and 169 were Company-operated. In addition to its breakfast-all-day items, Denny’s offers a selection of lunch and dinner items, including burgers, sandwiches, salads and skillet entrees, along with an assortment of beverages, appetizers and desserts. The Company’s Fit Fare menu helps its guests identify items suited to their dietary needs. Most Denny’s restaurants offer special items for children and seniors. The Company has restaurant locations within travel centers, primarily with Pilot and Pilot Flying J Travel Centers.
One Group Hospitality Company Profile
The ONE Group Hospitality, Inc., formerly Committed Capital Acquisition Corporation, is a hospitality company. The Company develops, owns and operates restaurants and lounges, and provides food and beverage services for hospitality venues, including hotels, casinos and other locations across the globe. It operates through three segments: owned STK units (STKs), F&B hospitality management agreements (F&B), and Other concepts (Other). Its STKs segment consists of leased restaurant locations. Its F&B segment consists of management agreements, in which the Company operates the food and beverage services in hotels or casinos and could include an STK. Its Other segment includes owned non-STK leased locations. Its restaurant brand is STK, a multi-unit steakhouse concept with locations in metropolitan cities around the globe. Its F&B hospitality management services include developing, managing and operating restaurants, bars, rooftop lounges, pools, banqueting and catering facilities.
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