7 DAYS GROUP (NYSE: SVN) and La Quinta (NYSE:LQ) are both cyclical consumer goods & services companies, but which is the superior stock? We will contrast the two companies based on the strength of their earnings, analyst recommendations, institutional ownership, profitability, valuation, dividends and risk.

Earnings & Valuation

This table compares 7 DAYS GROUP and La Quinta’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
7 DAYS GROUP N/A N/A N/A $0.53 N/A
La Quinta $1.01 billion 2.08 -$1.28 million $0.26 68.39

7 DAYS GROUP has higher earnings, but lower revenue than La Quinta. 7 DAYS GROUP is trading at a lower price-to-earnings ratio than La Quinta, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for 7 DAYS GROUP and La Quinta, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
7 DAYS GROUP 0 0 0 0 N/A
La Quinta 0 2 2 0 2.50

La Quinta has a consensus target price of $17.08, indicating a potential downside of 3.92%.

Profitability

This table compares 7 DAYS GROUP and La Quinta’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
7 DAYS GROUP N/A N/A N/A
La Quinta 3.11% 6.23% 1.45%

Insider and Institutional Ownership

98.5% of La Quinta shares are held by institutional investors. 1.3% of La Quinta shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Summary

La Quinta beats 7 DAYS GROUP on 7 of the 8 factors compared between the two stocks.

About 7 DAYS GROUP

7 Days Group Holdings Limited (7 Days Inn) is an offshore holding company structure and conducts its operations in the People’s Republic of China through its wholly owned subsidiary, 7 Days Inn (Shenzhen) Co., Ltd. (7 Days Shenzhen), and its subsidiaries and branches. The Company converts and operates limited service economy hotels across metropolitan areas in the People’s Republic of China. It offers accommodations and services. As of December 31, 2010, it had 568 hotels in operation, 247 of which were managed hotels, with 56,410 hotel rooms in 89 cities, and an additional 197 hotels with 19,345 hotel rooms under conversion. As of December 31, 2010, approximately 16.5 million members were registered with its 7 Days Club. In December 2011, the Company acquired Hunan Huatian Star Hotel Management Limited.

About La Quinta

La Quinta Holdings Inc. is an owner, operator and franchisor of select-service hotels primarily serving the midscale and upper-midscale sectors under the La Quinta brand. The Company’s segments include owned hotels, franchise and management, and corporate and other. The owned hotels segment is engaged in the operation of owned hotel properties. The franchise and management segment is engaged in various license, franchise and management agreements relating to its owned and franchised hotels. As of December 31, 2016, its portfolio consisted of 888 hotels representing approximately 87,200 rooms located primarily across 48 states in the United States, as well as in Canada, Mexico, Honduras and Colombia, of which 322 hotels were owned and operated, and 566 were franchised. As of December 31, 2016, the Company had a pipeline of 248 franchised hotels in the United States, Mexico, Colombia, Nicaragua, Guatemala, Chile and El Salvador.

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