Carrols Restaurant Group (NASDAQ: TAST) and Popeyes Louisiana Kitchen (NASDAQ:PLKI) are both retail/wholesale companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, analyst recommendations, risk, profitabiliy, earnings, institutional ownership and dividends.

Earnings and Valuation

This table compares Carrols Restaurant Group and Popeyes Louisiana Kitchen’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Carrols Restaurant Group $960.92 million 0.45 $81.30 million $0.80 15.38
Popeyes Louisiana Kitchen N/A N/A N/A $1.96 40.29

Carrols Restaurant Group has higher revenue and earnings than Popeyes Louisiana Kitchen. Carrols Restaurant Group is trading at a lower price-to-earnings ratio than Popeyes Louisiana Kitchen, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Carrols Restaurant Group has a beta of 0.02, indicating that its share price is 98% less volatile than the S&P 500. Comparatively, Popeyes Louisiana Kitchen has a beta of -0.11, indicating that its share price is 111% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and price targets for Carrols Restaurant Group and Popeyes Louisiana Kitchen, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Carrols Restaurant Group 0 0 1 0 3.00
Popeyes Louisiana Kitchen 1 5 1 0 2.00

Carrols Restaurant Group currently has a consensus target price of $17.00, suggesting a potential upside of 38.21%. Popeyes Louisiana Kitchen has a consensus target price of $67.00, suggesting a potential downside of 15.16%. Given Carrols Restaurant Group’s stronger consensus rating and higher possible upside, equities analysts clearly believe Carrols Restaurant Group is more favorable than Popeyes Louisiana Kitchen.

Profitability

This table compares Carrols Restaurant Group and Popeyes Louisiana Kitchen’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Carrols Restaurant Group 3.93% 10.18% 2.97%
Popeyes Louisiana Kitchen 15.08% 490.51% 15.48%

Insider & Institutional Ownership

84.2% of Carrols Restaurant Group shares are owned by institutional investors. Comparatively, 97.6% of Popeyes Louisiana Kitchen shares are owned by institutional investors. 5.3% of Carrols Restaurant Group shares are owned by insiders. Comparatively, 2.2% of Popeyes Louisiana Kitchen shares are owned 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.

About Carrols Restaurant Group

Carrols Restaurant Group, Inc. is a holding company and conducts all of its operations through its subsidiary, Carrols Corporation (Carrols) and Carrols’ subsidiary, Carrols LLC. The Company is a restaurant company and Burger King franchisee in the United States. As of January 1, 2017, the Company had owned and operated 753 Burger King restaurants under the name Burger King in 16 Northeastern, Midwestern and Southeastern states. Burger King restaurants feature the flame-broiled Whopper sandwich, as well as a range of hamburgers, chicken and other specialty sandwiches, French fries, salads, breakfast items, hot dogs, snacks, smoothies, frappes and other offerings. The Company’s Burger King restaurants are located in various states, such as Illinois, Indiana, Kentucky, Maine, Massachusetts, Michigan, New Jersey, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Tennessee, Vermont, Virginia and West Virginia.

About Popeyes Louisiana Kitchen

Popeyes Louisiana Kitchen, Inc. (Popeyes) develops, operates and franchises quick-service restaurants (QSRs) under the trade names Popeyes Louisiana Kitchen and Popeyes Chicken & Biscuits. The Company conducts its operations through two segments: franchise operations and Company-operated restaurants. The Company-operated restaurant segment includes the operation of Company-owned restaurants. The franchise operations segment consists of domestic and international franchising activities. The Company’s Louisiana style menu features spicy chicken, chicken tenders, fried shrimp and other seafood, red beans and rice, and other regional items. As of December 25, 2016, the Company operated and franchised 2,688 Popeyes restaurants in 48 states, the District of Columbia, three territories and 25 foreign countries. As of December 25, 2016, of the 55 Company-operated restaurants, approximately 84% were concentrated in Louisiana, North Carolina and Tennessee.

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