Reviewing BJ’s Restaurants (NASDAQ:BJRI) and Domino’s Pizza (NASDAQ:DPZ)

BJ’s Restaurants (NASDAQ:BJRI) and Domino’s Pizza (NASDAQ:DPZ) are both retail/wholesale companies, but which is the superior business? We will compare the two companies based on the strength of their analyst recommendations, profitability, valuation, institutional ownership, earnings, dividends and risk.

Profitability

This table compares BJ’s Restaurants and Domino’s Pizza’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
BJ’s Restaurants	3.15%	13.48%	4.92%
Domino’s Pizza	11.89%	-15.04%	33.66%

Risk & Volatility

BJ’s Restaurants has a beta of 1.29, indicating that its stock price is 29% more volatile than the S&P 500. Comparatively, Domino’s Pizza has a beta of 1.02, indicating that its stock price is 2% more volatile than the S&P 500.

Insider & Institutional Ownership

100.0% of BJ’s Restaurants shares are owned by institutional investors. Comparatively, 94.6% of Domino’s Pizza shares are owned by institutional investors. 4.9% of BJ’s Restaurants shares are owned by company insiders. Comparatively, 0.9% of Domino’s Pizza shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of recent ratings and price targets for BJ’s Restaurants and Domino’s Pizza, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
BJ’s Restaurants	2	6	2	0	2.00
Domino’s Pizza	2	12	17	0	2.48

BJ’s Restaurants currently has a consensus price target of $42.00, indicating a potential downside of 0.26%. Domino’s Pizza has a consensus price target of $419.74, indicating a potential upside of 34.01%. Given Domino’s Pizza’s stronger consensus rating and higher possible upside, analysts clearly believe Domino’s Pizza is more favorable than BJ’s Restaurants.

Earnings & Valuation

This table compares BJ’s Restaurants and Domino’s Pizza”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
BJ’s Restaurants	$1.40 billion	0.63	$48.81 million	$1.98	21.27
Domino’s Pizza	$4.94 billion	2.11	$601.70 million	$17.37	18.03

Domino’s Pizza has higher revenue and earnings than BJ’s Restaurants. Domino’s Pizza is trading at a lower price-to-earnings ratio than BJ’s Restaurants, indicating that it is currently the more affordable of the two stocks.

Summary

Domino’s Pizza beats BJ’s Restaurants on 9 of the 14 factors compared between the two stocks.

About BJ’s Restaurants

BJ’s Restaurants, Inc. owns and operates casual dining restaurants in the United States. Its restaurants offer pizzas, craft and other beers, appetizers, entrées, pastas, sandwiches, specialty salads, and desserts under brand name Pizookie. The company was formerly known as Chicago Pizza & Brewery, Inc. and changed its name to BJ’s Restaurants, Inc. in August 2004. BJ’s Restaurants, Inc. was founded in 1978 and is based in Huntington Beach, California.

About Domino’s Pizza

Domino’s Pizza, Inc., through its subsidiaries, operates as a pizza company in the United States and internationally. The company operates through three segments: U.S. Stores, International Franchise, and Supply Chain. It offers pizzas under the Domino’s brand name through company-owned and franchised stores. It also provides oven-baked sandwiches, pastas, boneless chicken and chicken wings, breads and dips, desserts, and soft drink products, as well as loaded tots and pepperoni stuffed cheesy breads. Domino’s Pizza, Inc. was founded in 1960 and is headquartered in Ann Arbor, Michigan.