Chanticleer (NASDAQ:BURG) and Arcos Dorados (NYSE:ARCO) are both small-cap retail/wholesale companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, earnings, institutional ownership, profitability, valuation, dividends and risk.
Valuation and Earnings
This table compares Chanticleer and Arcos Dorados’ revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Chanticleer||$41.43 million||0.20||-$6.79 million||($1.78)||-1.28|
|Arcos Dorados||$3.32 billion||0.41||$129.16 million||$0.61||10.54|
Arcos Dorados pays an annual dividend of $0.10 per share and has a dividend yield of 1.6%. Chanticleer does not pay a dividend. Arcos Dorados pays out 16.4% of its earnings in the form of a dividend.
This table compares Chanticleer and Arcos Dorados’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a summary of current ratings and target prices for Chanticleer and Arcos Dorados, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Arcos Dorados has a consensus price target of $12.00, suggesting a potential upside of 86.63%. Given Arcos Dorados’ higher possible upside, analysts plainly believe Arcos Dorados is more favorable than Chanticleer.
Institutional and Insider Ownership
4.2% of Chanticleer shares are held by institutional investors. Comparatively, 35.7% of Arcos Dorados shares are held by institutional investors. 18.8% of Chanticleer shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Volatility & Risk
Chanticleer has a beta of 2.29, meaning that its share price is 129% more volatile than the S&P 500. Comparatively, Arcos Dorados has a beta of 1.65, meaning that its share price is 65% more volatile than the S&P 500.
Arcos Dorados beats Chanticleer on 11 of the 14 factors compared between the two stocks.
Chanticleer Company Profile
Chanticleer Holdings, Inc., together with its subsidiaries, owns, operates, and franchises fast casual dining concepts in the United States and internationally. The company owns and operates 8 locations under the American Burger Company name in North Carolina, South Carolina, and New York; 8 company-owned locations in the United States and 13 franchisee-operated locations in the United States and the Middle East under The Burger Joint name; and 12 company-owned locations under the Little Big Burger name in the Portland, Oregon and Charlotte, North Carolina, as well as in Wallingford, Seattle. It also owns and operates 6 company-owned locations under the Just Fresh name in Charlotte, North Carolina; and 8 full service restaurants under the Hooters name in the United States, South Africa, and the United Kingdom. The company was formerly known as Tulvine Systems, Inc. and changed its name to Chanticleer Holdings, Inc. in May 2005. Chanticleer Holdings, Inc. was founded in 1999 and is based in Charlotte, North Carolina.
Arcos Dorados Company Profile
Arcos Dorados Holdings Inc. operates as a franchisee of McDonald's restaurants. It has the exclusive right to own, operate, and grant franchises of McDonald's restaurants in 20 countries and territories in Latin America and the Caribbean, including Argentina, Aruba, Brazil, Chile, Colombia, Costa Rica, Curaçao, Ecuador, French Guiana, Guadeloupe, Martinique, Mexico, Panama, Peru, Puerto Rico, Trinidad and Tobago, Uruguay, the United States Virgin Islands of St. Croix and St. Thomas, and Venezuela. As of April 27, 2018, the company operated or franchised approximately 2,100 McDonald's-branded restaurants. Arcos Dorados Holdings Inc. was founded in 2007 and is based in Montevideo, Uruguay.
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