CEC Entertainment (CEC) & Papa Murphy’s Holdings (FRSH) Head to Head Analysis

CEC Entertainment (NYSE: CEC) and Papa Murphy’s Holdings (NASDAQ:FRSH) are both small-cap quick service restaurants companies, but which is the superior business? We will contrast the two companies based on the strength of their profitability, institutional ownership, dividends, valuation, analyst recommendations, earnings and risk.

Valuation & Earnings

This table compares CEC Entertainment and Papa Murphy’s Holdings’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
CEC Entertainment N/A N/A N/A $2.73 N/A
Papa Murphy’s Holdings $126.88 million 0.79 $2.64 million ($0.71) -8.31

Papa Murphy’s Holdings has higher revenue and earnings than CEC Entertainment. Papa Murphy’s Holdings is trading at a lower price-to-earnings ratio than CEC Entertainment, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

32.5% of Papa Murphy’s Holdings shares are held by institutional investors. 3.1% of Papa Murphy’s Holdings shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of recent ratings and target prices for CEC Entertainment and Papa Murphy’s Holdings, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CEC Entertainment 0 0 0 0 N/A
Papa Murphy’s Holdings 0 2 0 0 2.00

Papa Murphy’s Holdings has a consensus price target of $4.75, suggesting a potential downside of 19.49%.

Profitability

This table compares CEC Entertainment and Papa Murphy’s Holdings’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
CEC Entertainment N/A N/A N/A
Papa Murphy’s Holdings -6.97% -8.39% -3.00%

Risk and Volatility

CEC Entertainment has a beta of 0.61, meaning that its stock price is 39% less volatile than the S&P 500. Comparatively, Papa Murphy’s Holdings has a beta of 0.03, meaning that its stock price is 97% less volatile than the S&P 500.

Summary

CEC Entertainment beats Papa Murphy’s Holdings on 5 of the 8 factors compared between the two stocks.

CEC Entertainment Company Profile

CEC Entertainment, Inc. is engaged in the family dining and entertainment center business. The Company develops, operates and franchises family dining and entertainment centers under the name Chuck E. Cheese’s. Chuck E. Cheese’s stores feature musical and comic entertainment by robotic and animated characters, arcade-style and skill-oriented games, video games, rides and other activities. All of its stores offer dining selections consisting of a range of beverages, pizzas, sandwiches, appetizers, a salad bar and desserts. As of January 1, 2012, the Company and its franchisees operated a total of 556 Chuck E. Cheese’s stores. As of January 1, 2012, it operated 507 Company-owned Chuck E. Cheese’s stores located in 44 states and Canada and its franchisees operated a total of 49 stores located in 15 states, Puerto Rico, Guam, Guatemala, Chile, Saudi Arabia and the United Arab Emirates. In February 2014, Apollo Global Management, LLC completed the acquisition of CEC Entertainment Inc.

Papa Murphy’s Holdings Company Profile

Papa Murphy’s Holdings, Inc. is a holding company. The Company, together with its subsidiaries, is a franchisor and operator of the Take ‘N’ Bake pizza chain in the United States. The Company franchises the right to operate Take ‘N’ Bake pizza franchises and operates Take ‘N’ Bake pizza stores owned by the Company. The Company operates through three segments: Domestic Company Stores, Domestic Franchise and International. Its Domestic Franchise segment consists of its domestic franchised stores, which represent its system-wide stores and derives its revenues from franchise and development fees and the collection of franchise royalties. The Domestic Company Stores segment consists of its Company-owned stores in the United States and derives its revenues from retail sales of pizza and side items to the general public. Its International segment consists of its stores outside of the United States, all of which are franchised and derives its revenues from franchise and development fees.

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