Ruby Tuesday (NYSE: RT) and The ONE Group Hospitality (NASDAQ:STKS) are both small-cap retail/wholesale companies, but which is the better business? We will compare the two companies based on the strength of their institutional ownership, profitability, risk, earnings, analyst recommendations, dividends and valuation.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Ruby Tuesday and The ONE Group Hospitality, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ruby Tuesday 0 0 0 0 N/A
The ONE Group Hospitality 0 0 0 0 N/A

Institutional and Insider Ownership

74.4% of Ruby Tuesday shares are held by institutional investors. Comparatively, 14.3% of The ONE Group Hospitality shares are held by institutional investors. 4.8% of Ruby Tuesday shares are held by insiders. Comparatively, 35.9% of The ONE Group Hospitality shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Volatility & Risk

Ruby Tuesday has a beta of 0.53, suggesting that its stock price is 47% less volatile than the S&P 500. Comparatively, The ONE Group Hospitality has a beta of 0.38, suggesting that its stock price is 62% less volatile than the S&P 500.

Profitability

This table compares Ruby Tuesday and The ONE Group Hospitality’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ruby Tuesday -8.36% -3.67% -1.56%
The ONE Group Hospitality -25.48% -68.30% -7.44%

Valuation & Earnings

This table compares Ruby Tuesday and The ONE Group Hospitality’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Ruby Tuesday $951.97 million 0.15 -$106.14 million ($1.26) -1.90
The ONE Group Hospitality $72.41 million 0.71 -$16.68 million ($0.79) -2.57

The ONE Group Hospitality has higher revenue, but lower earnings than Ruby Tuesday. The ONE Group Hospitality is trading at a lower price-to-earnings ratio than Ruby Tuesday, indicating that it is currently the more affordable of the two stocks.

Summary

Ruby Tuesday beats The ONE Group Hospitality on 6 of the 10 factors compared between the two stocks.

Ruby Tuesday Company Profile

Ruby Tuesday, Inc. owns and operates Ruby Tuesday casual dining and Lime Fresh Mexican Grill (Lime Fresh) casual restaurants. The Company also franchises the Ruby Tuesday concept in selected domestic and international markets, and the Lime Fresh concept in selected domestic markets. Its segments include Ruby Tuesday concept and Lime Fresh concept. As of March 1, 2016, the Company operated 729 Ruby Tuesday restaurants in 44 states, 13 foreign countries, and Guam, and there were 16 Lime Fresh restaurants in two states. Of those restaurants, it owned and operated approximately 649 Ruby Tuesday restaurants and franchised over 80 Ruby Tuesday restaurants, which consisted of 28 domestic and 52 international restaurants. It also owned and operated over eight Lime Fresh restaurants and franchised eight Lime Fresh domestic restaurants. The Company’s corporate-owned and operated restaurants are concentrated primarily in the Southeast, Northeast, Mid-Atlantic and Midwest of the United States.

The ONE Group Hospitality Company Profile

The ONE Group Hospitality, Inc., formerly Committed Capital Acquisition Corporation, is a hospitality company. The Company develops, owns and operates restaurants and lounges, and provides food and beverage services for hospitality venues, including hotels, casinos and other locations across the globe. It operates through three segments: owned STK units (STKs), F&B hospitality management agreements (F&B), and Other concepts (Other). Its STKs segment consists of leased restaurant locations. Its F&B segment consists of management agreements, in which the Company operates the food and beverage services in hotels or casinos and could include an STK. Its Other segment includes owned non-STK leased locations. Its restaurant brand is STK, a multi-unit steakhouse concept with locations in metropolitan cities around the globe. Its F&B hospitality management services include developing, managing and operating restaurants, bars, rooftop lounges, pools, banqueting and catering facilities.

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