Critical Analysis: Chipotle Mexican Grill (OTCMKTS:CMG.B) versus Royal Caribbean Cruises (NYSE:RCL)

Royal Caribbean Cruises (NYSE:RCL) and Chipotle Mexican Grill (OTCMKTS:CMG.B) are both consumer discretionary companies, but which is the superior investment? We will contrast the two companies based on the strength of their earnings, dividends, valuation, profitability, risk, analyst recommendations and institutional ownership.

Institutional and Insider Ownership

87.5% of Royal Caribbean Cruises shares are held by institutional investors. 6.4% of Royal Caribbean Cruises shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Royal Caribbean Cruises and Chipotle Mexican Grill, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Royal Caribbean Cruises	0	7	14	1	2.73
Chipotle Mexican Grill	0	0	0	0	0.00

Royal Caribbean Cruises currently has a consensus price target of $353.40, suggesting a potential upside of 13.88%. Given Royal Caribbean Cruises’ stronger consensus rating and higher probable upside, equities research analysts clearly believe Royal Caribbean Cruises is more favorable than Chipotle Mexican Grill.

Profitability

This table compares Royal Caribbean Cruises and Chipotle Mexican Grill’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Royal Caribbean Cruises	23.54%	43.33%	10.56%
Chipotle Mexican Grill	N/A	N/A	N/A

Valuation & Earnings

This table compares Royal Caribbean Cruises and Chipotle Mexican Grill”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Royal Caribbean Cruises	$17.93 billion	4.63	$4.27 billion	$16.18	19.18
Chipotle Mexican Grill	N/A	N/A	N/A	N/A	N/A

Royal Caribbean Cruises has higher revenue and earnings than Chipotle Mexican Grill.

Summary

Royal Caribbean Cruises beats Chipotle Mexican Grill on 10 of the 10 factors compared between the two stocks.

About Royal Caribbean Cruises

Royal Caribbean Cruises Ltd. operates as a cruise company worldwide. The company operates cruises under the Royal Caribbean International, Celebrity Cruises, and Silversea Cruises brands, which comprise a range of itineraries. As of February 21, 2024, it operated 65 ships. Royal Caribbean Cruises Ltd. was founded in 1968 and is headquartered in Miami, Florida.

About Chipotle Mexican Grill

Chipotle Mexican Grill, Inc., together with its subsidiaries, owns and operates Chipotle Mexican Grill restaurants. As of February 15, 2022, it owned and operated approximately 3,000 restaurants in the United States, Canada, the United Kingdom, France, Germany, and rest of Europe. The company was founded in 1993 and is headquartered in Newport Beach, California.