Head to Head Contrast: Planet Fitness (NYSE:PLNT) & Texas Roadhouse (NASDAQ:TXRH)

Planet Fitness (NYSE:PLNT) and Texas Roadhouse (NASDAQ:TXRH) are both consumer discretionary companies, but which is the superior stock? We will contrast the two businesses based on the strength of their risk, institutional ownership, dividends, profitability, analyst recommendations, earnings and valuation.

Risk and Volatility

Planet Fitness has a beta of 1.01, meaning that its share price is 1% more volatile than the S&P 500. Comparatively, Texas Roadhouse has a beta of 0.78, meaning that its share price is 22% less volatile than the S&P 500.

Insider and Institutional Ownership

95.5% of Planet Fitness shares are owned by institutional investors. Comparatively, 94.8% of Texas Roadhouse shares are owned by institutional investors. 0.9% of Planet Fitness shares are owned by insiders. Comparatively, 0.5% of Texas Roadhouse shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares Planet Fitness and Texas Roadhouse”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Planet Fitness	$1.32 billion	2.82	$219.10 million	$2.95	16.77
Texas Roadhouse	$5.88 billion	1.87	$405.55 million	$6.25	26.81

Texas Roadhouse has higher revenue and earnings than Planet Fitness. Planet Fitness is trading at a lower price-to-earnings ratio than Texas Roadhouse, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of current ratings for Planet Fitness and Texas Roadhouse, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Planet Fitness	1	9	11	1	2.55
Texas Roadhouse	0	12	10	1	2.52

Planet Fitness presently has a consensus target price of $70.24, indicating a potential upside of 41.95%. Texas Roadhouse has a consensus target price of $209.40, indicating a potential upside of 24.97%. Given Planet Fitness’ stronger consensus rating and higher possible upside, equities research analysts plainly believe Planet Fitness is more favorable than Texas Roadhouse.

Profitability

This table compares Planet Fitness and Texas Roadhouse’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Planet Fitness	16.88%	-59.46%	8.60%
Texas Roadhouse	6.63%	27.20%	11.75%

Summary

Planet Fitness beats Texas Roadhouse on 8 of the 14 factors compared between the two stocks.

About Planet Fitness

Planet Fitness, Inc., together with its subsidiaries, franchises and operates fitness centers under the Planet Fitness brand. The company operates through three segments: Franchise, Corporate-Owned Stores, and Equipment. The company is involved in franchising business in the United States, Puerto Rico, Canada, Panama, Mexico, and Australia. It engages in the sale of fitness equipment to franchisee-owned stores in the United States, Canada, and Mexico. In addition, the company operates corporate-owned stores in the United States and Canada. Planet Fitness, Inc. was founded in 1992 and is headquartered in Hampton, New Hampshire.

About Texas Roadhouse

Texas Roadhouse, Inc., together with its subsidiaries, operates casual dining restaurants in the United States and internationally. It also operates and franchises restaurants under the Texas Roadhouse, Bubba's 33, and Jaggers names in 49 states and ten internationally. Texas Roadhouse, Inc. was founded in 1993 and is based in Louisville, Kentucky.