Financial Analysis: Bloomin' Brands (BLMN) vs. One Group Hospitality (STKS)

Bloomin' Brands (NASDAQ: BLMN) and One Group Hospitality (NASDAQ:STKS) are both small-cap retail/wholesale companies, but which is the superior stock? We will compare the two companies based on the strength of their profitability, risk, valuation, dividends, analyst recommendations, earnings and institutional ownership.

Insider & Institutional Ownership

14.5% of One Group Hospitality shares are owned by institutional investors. 7.0% of Bloomin' Brands shares are owned by company insiders. Comparatively, 35.9% of One Group Hospitality shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Profitability

This table compares Bloomin' Brands and One Group Hospitality’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Bloomin' Brands 1.93% 94.30% 5.15%
One Group Hospitality -25.48% -68.30% -7.44%

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Bloomin' Brands and One Group Hospitality, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Bloomin' Brands 2 9 2 0 2.00
One Group Hospitality 0 0 0 0 N/A

Bloomin' Brands presently has a consensus price target of $22.10, suggesting a potential upside of 6.61%. Given Bloomin' Brands’ higher possible upside, equities research analysts plainly believe Bloomin' Brands is more favorable than One Group Hospitality.

Earnings and Valuation

This table compares Bloomin' Brands and One Group Hospitality’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Bloomin' Brands $4.25 billion 0.44 $41.74 million $0.77 26.92
One Group Hospitality $72.41 million 0.79 -$16.68 million ($0.80) -2.81

Bloomin' Brands has higher revenue and earnings than One Group Hospitality. One Group Hospitality is trading at a lower price-to-earnings ratio than Bloomin' Brands, indicating that it is currently the more affordable of the two stocks.

Dividends

Bloomin' Brands pays an annual dividend of $0.32 per share and has a dividend yield of 1.5%. One Group Hospitality does not pay a dividend. Bloomin' Brands pays out 41.6% of its earnings in the form of a dividend.

Risk & Volatility

Bloomin' Brands has a beta of 0.5, meaning that its stock price is 50% less volatile than the S&P 500. Comparatively, One Group Hospitality has a beta of 1, meaning that its stock price has a similar volatility profile to the S&P 500.

Summary

Bloomin' Brands beats One Group Hospitality on 9 of the 14 factors compared between the two stocks.

About Bloomin' Brands

Bloomin’ Brands, Inc. is a holding company. The Company owns and operates casual, upscale casual and fine dining restaurants. The Company operates through two segments: U.S. and International. The U.S. segment includes all brands operating in the United States. The International segment includes brands operating outside the United States. As of December 25, 2016, the Company had a portfolio of four restaurant concepts: Outback Steakhouse, Carrabba’s Italian Grill, Bonefish Grill, and Fleming’s Prime Steakhouse & Wine Bar. OSI Restaurant Partners, LLC (OSI) is the Company’s primary operating entity. New Private Restaurant Properties, LLC (PRP), an indirect subsidiary of the Company, leases the Company-owned restaurant properties to OSI’s subsidiaries. As of December 25, 2016, the Company owned and operated 1,276 restaurants and franchised 240 restaurants across 48 states, Puerto Rico, Guam and 20 countries.

About One Group Hospitality

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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