Analyzing Domino’s Pizza Enterprises (OTCMKTS:DPZUF) and Jack In The Box (NASDAQ:JACK)

Jack In The Box (NASDAQ:JACK) and Domino’s Pizza Enterprises (OTCMKTS:DPZUF) are both consumer discretionary companies, but which is the better business? We will contrast the two businesses based on the strength of their profitability, dividends, institutional ownership, earnings, valuation, risk and analyst recommendations.

Dividends

Jack In The Box pays an annual dividend of $1.76 per share and has a dividend yield of 8.4%. Domino’s Pizza Enterprises pays an annual dividend of $0.33 per share and has a dividend yield of 2.3%. Jack In The Box pays out -41.2% of its earnings in the form of a dividend. Domino’s Pizza Enterprises pays out 66.5% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Jack In The Box is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider & Institutional Ownership

99.8% of Jack In The Box shares are owned by institutional investors. Comparatively, 27.0% of Domino’s Pizza Enterprises shares are owned by institutional investors. 1.4% of Jack In The Box shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Jack In The Box and Domino’s Pizza Enterprises”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Jack In The Box	$1.47 billion	0.27	-$80.72 million	($4.27)	-4.91
Domino’s Pizza Enterprises	N/A	N/A	N/A	$0.50	28.71

Domino’s Pizza Enterprises has lower revenue, but higher earnings than Jack In The Box. Jack In The Box is trading at a lower price-to-earnings ratio than Domino’s Pizza Enterprises, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Jack In The Box and Domino’s Pizza Enterprises, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Jack In The Box	2	14	5	0	2.14
Domino’s Pizza Enterprises	0	0	0	0	0.00

Jack In The Box currently has a consensus target price of $25.20, indicating a potential upside of 20.17%. Given Jack In The Box’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Jack In The Box is more favorable than Domino’s Pizza Enterprises.

Profitability

This table compares Jack In The Box and Domino’s Pizza Enterprises’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Jack In The Box	-5.51%	-9.23%	3.23%
Domino’s Pizza Enterprises	N/A	N/A	N/A

Summary

Jack In The Box beats Domino’s Pizza Enterprises on 9 of the 13 factors compared between the two stocks.

About Jack In The Box

Jack in the Box Inc. operates and franchises Jack in the Box and Del Taco quick-service restaurants in the United States. The company was founded in 1951 and is headquartered in San Diego, California.

About Domino’s Pizza Enterprises

Domino's Pizza Enterprises Limited operates retail food outlets. The company holds franchise rights for the Domino's brand in Australia, New Zealand, Belgium, France, the Netherlands, Japan, Cambodia, Germany, Luxembourg, Denmark, Taiwan, Malaysia, and Singapore. It operates various stores. Domino's Pizza Enterprises Limited was founded in 1983 and is based in Brisbane, Australia.