Target Hospitality (NASDAQ:TH – Get Free Report) and Aramark (NYSE:ARMK – Get Free Report) 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.
Analyst Recommendations
This is a breakdown of current ratings for Target Hospitality and Aramark, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Target Hospitality | 1 | 0 | 4 | 1 | 2.83 |
| Aramark | 0 | 1 | 13 | 1 | 3.00 |
Target Hospitality presently has a consensus target price of $25.20, indicating a potential upside of 89.19%. Aramark has a consensus target price of $69.25, indicating a potential upside of 26.96%. Given Target Hospitality’s higher possible upside, equities research analysts plainly believe Target Hospitality is more favorable than Aramark.
Profitability
This table compares Target Hospitality and Aramark’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Target Hospitality | -10.85% | -9.80% | -6.65% |
| Aramark | 1.93% | 17.68% | 4.21% |
Insider and Institutional Ownership
32.4% of Target Hospitality shares are owned by institutional investors. 3.8% of Target Hospitality shares are owned by insiders. Comparatively, 2.8% of Aramark 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.
Earnings & Valuation
This table compares Target Hospitality and Aramark”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Target Hospitality | $320.64 million | 4.14 | -$37.12 million | ($0.38) | -35.05 |
| Aramark | $18.51 billion | 0.78 | $326.39 million | $1.43 | 38.14 |
Aramark has higher revenue and earnings than Target Hospitality. Target Hospitality is trading at a lower price-to-earnings ratio than Aramark, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Target Hospitality has a beta of 1.49, meaning that its share price is 49% more volatile than the S&P 500. Comparatively, Aramark has a beta of 1.12, meaning that its share price is 12% more volatile than the S&P 500.
Summary
Aramark beats Target Hospitality on 9 of the 14 factors compared between the two stocks.
About Target Hospitality
Target Hospitality Corp. operates as a specialty rental and hospitality services company in North America. The company operates through two segments, Hospitality & Facilities Services – South and Government. It owns a network of specialty rental accommodation units. In addition, the company provides catering and food, maintenance, housekeeping, grounds-keeping, security, health and recreation facilities, workforce community management, concierge, and laundry services. It serves the U.S. government contractors and investment grade natural resource development companies. Target Hospitality Corp. was founded in 1978 and is headquartered in The Woodlands, Texas.
About Aramark
Aramark provides food and facilities services to education, healthcare, business and industry, sports, leisure, and corrections clients in the United States and internationally. It operates through two segments, Food and Support Services United States, and Food and Support Services International. The company offers food-related managed services, including dining, catering, food service management, and convenience-oriented retail services; non-clinical food and food-related support services, such as patient food and nutrition, retail food, environmental services, and procurement services; and plant operations and maintenance, custodial/housekeeping, energy management, grounds keeping, and capital project management services. It also provides on-site restaurants, catering, convenience stores, and executive dining services; beverage and vending services; and facility management services comprising landscaping, transportation, capital program management, payment services, and other facility consulting services relating to building operations. In addition, the company offers concessions, banquet, and catering services; retail services and merchandise sale, recreational, and lodging services; and facility management services at sports, entertainment, and recreational facilities. Further, it offers correctional food; and operates commissaries, laundry facilities, and property rooms. It primarily serves business and industry, sports, leisure and corrections, education, healthcare, public institutions, manufacturing, transportation, service, and other industries. The company was formerly known as ARAMARK Holdings Corporation. Aramark was founded in 1959 and is based in Philadelphia, Pennsylvania.
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