Red Robin Gourmet Burgers (NASDAQ:RRGB) versus RCI Hospitality (NASDAQ:RICK) Financial Analysis

Share on StockTwits

Red Robin Gourmet Burgers (NASDAQ:RRGB) and RCI Hospitality (NASDAQ:RICK) are both small-cap retail/wholesale companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, earnings, valuation, analyst recommendations, institutional ownership, profitability and dividends.

Analyst Ratings

This is a summary of current recommendations and price targets for Red Robin Gourmet Burgers and RCI Hospitality, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Red Robin Gourmet Burgers 1 5 2 0 2.13
RCI Hospitality 0 0 0 0 N/A

Red Robin Gourmet Burgers presently has a consensus target price of $34.50, indicating a potential upside of 7.98%. Given Red Robin Gourmet Burgers’ higher probable upside, equities analysts clearly believe Red Robin Gourmet Burgers is more favorable than RCI Hospitality.

Valuation & Earnings

This table compares Red Robin Gourmet Burgers and RCI Hospitality’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Red Robin Gourmet Burgers $1.34 billion 0.31 -$6.42 million $1.73 18.47
RCI Hospitality $165.75 million 1.12 $21.71 million $2.18 8.89

RCI Hospitality has lower revenue, but higher earnings than Red Robin Gourmet Burgers. RCI Hospitality is trading at a lower price-to-earnings ratio than Red Robin Gourmet Burgers, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Red Robin Gourmet Burgers has a beta of 1.24, indicating that its share price is 24% more volatile than the S&P 500. Comparatively, RCI Hospitality has a beta of 1.1, indicating that its share price is 10% more volatile than the S&P 500.

Profitability

This table compares Red Robin Gourmet Burgers and RCI Hospitality’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Red Robin Gourmet Burgers -0.55% 6.18% 2.21%
RCI Hospitality 9.09% 13.51% 6.32%

Institutional & Insider Ownership

46.8% of RCI Hospitality shares are held by institutional investors. 2.1% of Red Robin Gourmet Burgers shares are held by company insiders. Comparatively, 7.6% of RCI Hospitality shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Dividends

RCI Hospitality pays an annual dividend of $0.16 per share and has a dividend yield of 0.8%. Red Robin Gourmet Burgers does not pay a dividend. RCI Hospitality pays out 7.3% of its earnings in the form of a dividend.

Summary

RCI Hospitality beats Red Robin Gourmet Burgers on 9 of the 15 factors compared between the two stocks.

Red Robin Gourmet Burgers Company Profile

Red Robin Gourmet Burgers, Inc., together with its subsidiaries, develops, operates, and franchises full-service and casual-dining restaurants in the United States and Canada. The company's restaurants primarily offer burgers; various appetizers, salads, soups, seafood, and other entrees; and desserts, milkshakes, alcoholic and non-alcoholic specialty drinks, cocktails, wine, and beers. As of December 31, 2018, it operated 484 company-owned restaurants located in 39 states and 2 Canadian provinces; and had 89 casual-dining restaurants operated by franchisees in 16 states. The company was founded in 1969 and is headquartered in Greenwood Village, Colorado.

RCI Hospitality Company Profile

RCI Hospitality Holdings, Inc., through its subsidiaries, engages in the hospitality and related businesses in the United States. It operates in Nightclubs, Bombshells, and Media Group segments. The company owns and/or operates upscale adult nightclubs serving primarily businessmen and professionals under the Rick's Cabaret, Jaguars Club, Tootsie's Cabaret, XTC Cabaret, Club Onyx, Hoops Cabaret and Sports Bar, Scarlett's Cabaret, Temptations Adult Cabaret, Foxy's Cabaret, Vivid Cabaret, Downtown Cabaret, Cabaret East, The Seville, Silver City Cabaret, and Kappa Men's Club. It also operates restaurants and sports bars under the Bombshells Restaurant & Bar brand; and dance clubs under the Studio 80 brand. As of February 11, 2019, the company operated 46 units, including 39 nightclub units and 7 Bombshell units. In addition, it owns two national industry trade publications serving the adult nightclubs industry and the adult retail products industry; a national industry convention and tradeshow; and two national industry award shows, as well as approximately a dozen industry and social media Websites. The company was formerly known as Rick's Cabaret International, Inc. and changed its name to RCI Hospitality Holdings, Inc. in August 2014. RCI Hospitality Holdings, Inc. was founded in 1983 and is based in Houston, Texas.

Receive News & Ratings for Red Robin Gourmet Burgers Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Red Robin Gourmet Burgers and related companies with MarketBeat.com's FREE daily email newsletter.