Comparing Chipotle Mexican Grill (NYSE:CMG) and Rave Restaurant Group (NASDAQ:RAVE)

Chipotle Mexican Grill (NYSE:CMG) and Rave Restaurant Group (NASDAQ:RAVE) are both retail/wholesale companies, but which is the superior stock? We will contrast the two companies based on the strength of their profitability, valuation, risk, dividends, institutional ownership, analyst recommendations and earnings.

Volatility and Risk

Chipotle Mexican Grill has a beta of 0.98, indicating that its stock price is 2% less volatile than the S&P 500. Comparatively, Rave Restaurant Group has a beta of 0.45, indicating that its stock price is 55% less volatile than the S&P 500.

Insider & Institutional Ownership

91.3% of Chipotle Mexican Grill shares are owned by institutional investors. Comparatively, 15.1% of Rave Restaurant Group shares are owned by institutional investors. 0.8% of Chipotle Mexican Grill shares are owned by company insiders. Comparatively, 28.0% of Rave Restaurant Group shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Chipotle Mexican Grill and Rave Restaurant Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Chipotle Mexican Grill	13.04%	44.32%	17.19%
Rave Restaurant Group	22.44%	19.80%	16.71%

Analyst Ratings

This is a summary of recent ratings and price targets for Chipotle Mexican Grill and Rave Restaurant Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Chipotle Mexican Grill	1	11	22	2	2.69
Rave Restaurant Group	0	1	0	0	2.00

Chipotle Mexican Grill presently has a consensus target price of $49.81, suggesting a potential upside of 63.41%. Given Chipotle Mexican Grill’s stronger consensus rating and higher possible upside, equities analysts clearly believe Chipotle Mexican Grill is more favorable than Rave Restaurant Group.

Valuation & Earnings

This table compares Chipotle Mexican Grill and Rave Restaurant Group”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Chipotle Mexican Grill	$11.79 billion	3.42	$1.53 billion	$1.13	26.97
Rave Restaurant Group	$12.04 million	3.44	$2.70 million	$0.20	14.55

Chipotle Mexican Grill has higher revenue and earnings than Rave Restaurant Group. Rave Restaurant Group is trading at a lower price-to-earnings ratio than Chipotle Mexican Grill, indicating that it is currently the more affordable of the two stocks.

Summary

Chipotle Mexican Grill beats Rave Restaurant Group on 12 of the 15 factors compared between the two stocks.

About Chipotle Mexican Grill

Chipotle Mexican Grill, Inc., together with its subsidiaries, owns and operates Chipotle Mexican Grill restaurants. It sells food and beverages through offering burritos, burrito bowls, quesadillas, tacos, and salads. The company also provides delivery and related services its app and website. It has operations in the United States, Canada, France, Germany, and the United Kingdom. Chipotle Mexican Grill, Inc. was founded in 1993 and is headquartered in Newport Beach, California.

About Rave Restaurant Group

Rave Restaurant Group, Inc., together with its subsidiaries, engages in the operation and franchising of pizza buffet, delivery/carry-out (delco), and express restaurants under the Pizza Inn and Pie Five trademarks in the United States and internationally. The company operates through three segments: Pizza Inn Franchising, Pie Five Franchising, and Company-Owned Restaurants. Its buffet restaurants are located in free standing buildings or strip centers in retail developments that offer dine-in, carryout, and catering services, as well as delivery services. The company’s delco restaurants provide delivery and carryout services and are located in shopping centers or other in-line retail developments. Its Express restaurants serve customers through various non-traditional points of sale and are located in convenience stores, food courts, college campuses, airport terminals, travel plazas, athletic facilities, or other commercial facilities. The company’s Pizza Inn Express restaurants serve customers through a non-traditional, licensed, pizza-only model called Pizza Inn Express, located at production-oriented facilities. In addition, it operates and franchises fast casual restaurants under the Pie Five Pizza Company or Pie Five trademarks. The company was formerly known as Pizza Inn Holdings, Inc. and changed its name to Rave Restaurant Group, Inc. in January 2015. Rave Restaurant Group, Inc. was founded in 1958 and is based in The Colony, Texas.