Shake Shack (NYSE:SHAK) & Carnival (NYSE:CCL) Head-To-Head Contrast

Carnival (NYSE:CCL) and Shake Shack (NYSE:SHAK) are both consumer discretionary companies, but which is the better stock? We will contrast the two businesses based on the strength of their dividends, profitability, risk, analyst recommendations, valuation, earnings and institutional ownership.

Valuation and Earnings

This table compares Carnival and Shake Shack”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Carnival	$26.62 billion	1.15	$2.76 billion	$2.22	10.07
Shake Shack	$1.45 billion	1.69	$45.72 million	$0.94	60.69

Carnival has higher revenue and earnings than Shake Shack. Carnival is trading at a lower price-to-earnings ratio than Shake Shack, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Carnival and Shake Shack’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Carnival	11.24%	26.11%	6.36%
Shake Shack	2.56%	9.29%	2.71%

Analyst Ratings

This is a breakdown of current ratings for Carnival and Shake Shack, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Carnival	0	6	17	2	2.84
Shake Shack	0	12	16	0	2.57

Carnival currently has a consensus price target of $34.42, suggesting a potential upside of 54.00%. Shake Shack has a consensus price target of $89.71, suggesting a potential upside of 57.25%. Given Shake Shack’s higher probable upside, analysts plainly believe Shake Shack is more favorable than Carnival.

Volatility and Risk

Carnival has a beta of 2.31, meaning that its share price is 131% more volatile than the S&P 500. Comparatively, Shake Shack has a beta of 1.66, meaning that its share price is 66% more volatile than the S&P 500.

Institutional and Insider Ownership

67.2% of Carnival shares are held by institutional investors. Comparatively, 86.1% of Shake Shack shares are held by institutional investors. 7.9% of Carnival shares are held by company insiders. Comparatively, 8.3% of Shake Shack shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Summary

Carnival beats Shake Shack on 10 of the 15 factors compared between the two stocks.

About Carnival

Carnival Corp. engages in the operation of cruise ships. It operates through the following business segments: North America and Australia (NAA) Cruise, Europe and Asia (EA) Cruise Operations, Cruise Support, and Tour and Others. The North America and Australia (NAA) Cruise segment includes the Carnival Cruise Line, Holland America Line, Princess Cruises, and Seabourn. The Europe and Asia (EA) Cruise Operations segment consists of AIDA, Costa, Cunard, and P&O Cruises (UK). The Cruise Support segment represents port destinations and private islands for the benefit of its cruise brands. The Tour and Other segment operates hotel and transportation operations of Holland America Princess Alaska Tours. The company was founded in 1972 and is headquartered in Miami, FL.

About Shake Shack

Shake Shack Inc. owns, operates, and licenses Shake Shack restaurants (Shacks) in the United States and internationally. Its Shacks offers hamburgers, chicken, hot dogs, crinkle cut fries, shakes, frozen custard, beer, wine, and other products. The company was founded in 2001 and is headquartered in New York, New York.