Mcdonald’s (NASDAQ: BBRG) and Bravo Brio Restaurant Group (NASDAQ:BBRG) are both retail/wholesale companies, but which is the superior business? We will compare the two businesses based on the strength of their earnings, valuation, profitability, analyst recommendations, institutional ownership, risk and dividends.

Valuation and Earnings

This table compares Mcdonald’s and Bravo Brio Restaurant Group’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Mcdonald’s $22.82 billion 5.60 $5.19 billion $6.66 24.74
Bravo Brio Restaurant Group $407.61 million 0.15 -$9.76 million $0.22 18.41

Mcdonald’s has higher revenue and earnings than Bravo Brio Restaurant Group. Bravo Brio Restaurant Group is trading at a lower price-to-earnings ratio than Mcdonald’s, indicating that it is currently the more affordable of the two stocks.

Dividends

Mcdonald’s pays an annual dividend of $4.04 per share and has a dividend yield of 2.5%. Bravo Brio Restaurant Group does not pay a dividend. Mcdonald’s pays out 60.7% of its earnings in the form of a dividend. Mcdonald’s has increased its dividend for 41 consecutive years.

Insider & Institutional Ownership

67.0% of Mcdonald’s shares are held by institutional investors. Comparatively, 34.4% of Bravo Brio Restaurant Group shares are held by institutional investors. 0.2% of Mcdonald’s shares are held by company insiders. Comparatively, 7.5% of Bravo Brio Restaurant Group shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Volatility & Risk

Mcdonald’s has a beta of 0.66, suggesting that its stock price is 34% less volatile than the S&P 500. Comparatively, Bravo Brio Restaurant Group has a beta of 0.68, suggesting that its stock price is 32% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current recommendations for Mcdonald’s and Bravo Brio Restaurant Group, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Mcdonald’s 0 7 21 0 2.75
Bravo Brio Restaurant Group 0 1 0 0 2.00

Mcdonald’s currently has a consensus price target of $181.58, indicating a potential upside of 10.22%. Bravo Brio Restaurant Group has a consensus price target of $2.50, indicating a potential downside of 38.27%. Given Mcdonald’s’ stronger consensus rating and higher possible upside, research analysts clearly believe Mcdonald’s is more favorable than Bravo Brio Restaurant Group.

Profitability

This table compares Mcdonald’s and Bravo Brio Restaurant Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Mcdonald’s 25.26% -133.89% 17.46%
Bravo Brio Restaurant Group -3.86% -15.00% -2.55%

Summary

Mcdonald’s beats Bravo Brio Restaurant Group on 13 of the 17 factors compared between the two stocks.

Mcdonald’s Company Profile

McDonald's Corporation operates and franchises McDonald's restaurants in the United States and internationally. Its restaurants offer various food products, soft drinks, coffee, and other beverages, as well as breakfast menu. As of December 31, 2017, the company operated 37,241 restaurants, including 34,108 franchised restaurants comprising 21,366 franchised to conventional franchisees, 6,945 licensed to developmental licensees, and 5,797 licensed to foreign affiliates; and 3,133 company-operated restaurants. McDonald's Corporation was founded in 1940 and is headquartered in Chicago, Illinois.

Bravo Brio Restaurant Group Company Profile

Bravo Brio Restaurant Group, Inc. owns and operates Italian restaurants in the United States. It operates full-service Italian restaurants under the BRAVO! Cucina Italiana brand name; Italian chophouse restaurants under the BRIO Tuscan Grille brand name; and full-service American-French bistro restaurant under the Bon Vie brand name. The company's restaurants primarily offer Italian food and wine. As of December 31, 2017, it operated 49 BRAVO! restaurants, 64 BRIO restaurants, and 1 Bon Vie restaurant in 32 states. The company was formerly known as Bravo Development, Inc. and changed its name to Bravo Brio Restaurant Group, Inc. in June 2010. Bravo Brio Restaurant Group, Inc. was incorporated in 1987 and is based in Columbus, Ohio.

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