Noble Roman’s (OTCMKTS: NROM) and Dave & Buster’s Entertainment (NASDAQ:PLAY) are both retail/wholesale companies, but which is the superior business? We will contrast the two businesses based on the strength of their analyst recommendations, profitability, earnings, institutional ownership, valuation, dividends and risk.

Risk & Volatility

Noble Roman’s has a beta of 1.38, meaning that its share price is 38% more volatile than the S&P 500. Comparatively, Dave & Buster’s Entertainment has a beta of 0.65, meaning that its share price is 35% less volatile than the S&P 500.

Profitability

This table compares Noble Roman’s and Dave & Buster’s Entertainment’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Noble Roman’s -5.45% 8.25% 5.95%
Dave & Buster’s Entertainment 10.27% 24.58% 9.96%

Analyst Recommendations

This is a summary of current recommendations for Noble Roman’s and Dave & Buster’s Entertainment, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Noble Roman’s 0 0 0 0 N/A
Dave & Buster’s Entertainment 0 0 9 0 3.00

Dave & Buster’s Entertainment has a consensus price target of $75.25, indicating a potential upside of 47.69%. Given Dave & Buster’s Entertainment’s higher possible upside, analysts clearly believe Dave & Buster’s Entertainment is more favorable than Noble Roman’s.

Insider and Institutional Ownership

0.3% of Noble Roman’s shares are held by institutional investors. 29.7% of Noble Roman’s shares are held by insiders. Comparatively, 5.6% of Dave & Buster’s Entertainment shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Noble Roman’s and Dave & Buster’s Entertainment’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Noble Roman’s $8.80 million 1.16 $3.32 million ($0.03) -16.33
Dave & Buster’s Entertainment $1.05 billion 2.01 $254.99 million $2.57 19.82

Dave & Buster’s Entertainment has higher revenue and earnings than Noble Roman’s. Noble Roman’s is trading at a lower price-to-earnings ratio than Dave & Buster’s Entertainment, indicating that it is currently the more affordable of the two stocks.

Summary

Dave & Buster’s Entertainment beats Noble Roman’s on 10 of the 13 factors compared between the two stocks.

About Noble Roman’s

Noble Roman’s, Inc., with its two subsidiaries, Pizzaco, Inc. and N.R. Realty, Inc., sells and services franchises and licenses for non-traditional foodservice operations and take-n-bake locations under the names Noble Roman’s Pizza, Noble Roman’s Take-N-Bake and Tuscano’s Italian Style Subs. It offers pizza and sub sandwiches, along with other related menu items. The Company, through Noble Roman’s Pizza, offers fresh packed, uncondensed and never cooked sauce made with spices, parmesan cheese and vine-ripened tomatoes. It also offers real cheese blended from mozzarella and Muenster. Its product line includes breadsticks and cheesy stix with dip, pasta, baked sandwiches, salads, wings and a line of breakfast products. It has developed a take-n-bake version of its pizza as an addition to its menu offerings. It offers the take-n-bake program in grocery stores. Its Tuscano’s Italian Style Subs focuses on sub sandwich menu items. It operates over 2,210 franchised or licensed outlets.

About Dave & Buster’s Entertainment

Dave & Buster’s Entertainment, Inc. owns and operates entertainment and dining venues for adults and families in North America. Its venues offer a menu of ‘Fun American New Gourmet’ entrées and appetizers, as well as a selection of non-alcoholic and alcoholic beverages; and an assortment of entertainment attractions centered on playing games and watching live sports, and other televised events. The company operates its venues under the Dave & Buster’s name. As of June 6, 2017, it owned and operated 99 stores located in 34 states and Canada. The company was founded in 1982 and is headquartered in Dallas, Texas.

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