Biglari (NYSE: BH) and DineEquity (NYSE:DIN) are both small-cap retail/wholesale companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, analyst recommendations, valuation, profitability, dividends, earnings and risk.
DineEquity pays an annual dividend of $3.88 per share and has a dividend yield of 7.3%. Biglari does not pay a dividend. DineEquity pays out -17.7% of its earnings in the form of a dividend. Biglari has raised its dividend for 3 consecutive years.
This table compares Biglari and DineEquity’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Biglari||$850.08 million||1.00||$99.45 million||$42.31||9.73|
|DineEquity||$633.97 million||1.51||$97.99 million||($21.88)||-2.42|
Biglari has higher revenue and earnings than DineEquity. DineEquity is trading at a lower price-to-earnings ratio than Biglari, indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
Biglari has a beta of 0.37, suggesting that its share price is 63% less volatile than the S&P 500. Comparatively, DineEquity has a beta of 0.51, suggesting that its share price is 49% less volatile than the S&P 500.
This is a summary of recent recommendations and price targets for Biglari and DineEquity, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
DineEquity has a consensus target price of $58.75, suggesting a potential upside of 10.74%. Given DineEquity’s stronger consensus rating and higher probable upside, analysts clearly believe DineEquity is more favorable than Biglari.
This table compares Biglari and DineEquity’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Insider and Institutional Ownership
87.9% of Biglari shares are held by institutional investors. Comparatively, 92.7% of DineEquity shares are held by institutional investors. 51.2% of Biglari shares are held by company insiders. Comparatively, 2.2% of DineEquity shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
DineEquity beats Biglari on 9 of the 17 factors compared between the two stocks.
Biglari Company Profile
Biglari Holdings Inc. is a holding company owning subsidiaries engaged in various business activities, including media, property and casualty insurance, and restaurants The Company’s segments include Restaurant Operations, First Guard, Maxim, Other and Corporate. The Company’s restaurant operations’ activities are conducted through approximately two restaurant concepts operated by subsidiaries Steak n Shake Inc. (Steak n Shake) and Western Sizzlin Corporation (Western). Steak n Shake is engaged in the ownership, operation and franchising of Steak n Shake restaurants. Western is engaged primarily in the franchising of restaurants. The Company’s insurance business consists of First Guard Insurance Company and its agency, 1st Guard Corporation. First Guard is a direct underwriter of commercial trucking insurance, selling physical damage and non-trucking liability insurance to truckers. Its media business consists of Maxim. Maxim’s business lies principally in media and licensing.
DineEquity Company Profile
DineEquity, Inc., through its subsidiaries, owns and franchises the Applebee’s Neighborhood Grill & Bar (Applebee’s) concept in the bar and grill segment within the casual dining category of the restaurant industry, and owns, franchises and operates the International House of Pancakes (IHOP) concept in the family dining category of the restaurant industry. It operates through four segments: Franchise operations, Rental operations, Company restaurant operations and Financing operations. As of December 31, 2016, it had 3,749 restaurants. Applebee’s menu features a selection of grill and bar fare, such as appetizers, bar snacks, burgers, classic entrees and lighter fare, as well as cocktails, beers and desserts. As of December 31, 2016, IHOP franchise and area license restaurants were located in all 50 states within the United States, in the District of Columbia, in three United States territories and in 10 countries outside of the United States.
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