Critical Review: Diversified Restaurant Holdings (SAUC) vs. The Competition
Diversified Restaurant Holdings (NASDAQ: SAUC) is one of 44 public companies in the “Restaurants & Bars” industry, but how does it weigh in compared to its peers? We will compare Diversified Restaurant Holdings to similar companies based on the strength of its valuation, earnings, profitability, risk, analyst recommendations, institutional ownership and dividends.
This table compares Diversified Restaurant Holdings and its peers’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Diversified Restaurant Holdings||-3.39%||-60.83%||-0.51%|
|Diversified Restaurant Holdings Competitors||1.77%||12.50%||1.76%|
This is a summary of recent ratings and price targets for Diversified Restaurant Holdings and its peers, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Diversified Restaurant Holdings||0||0||1||0||3.00|
|Diversified Restaurant Holdings Competitors||272||1548||2139||73||2.50|
Diversified Restaurant Holdings presently has a consensus target price of $3.50, indicating a potential upside of 72.41%. As a group, “Restaurants & Bars” companies have a potential upside of 10.94%. Given Diversified Restaurant Holdings’ stronger consensus rating and higher probable upside, research analysts plainly believe Diversified Restaurant Holdings is more favorable than its peers.
Insider & Institutional Ownership
11.1% of Diversified Restaurant Holdings shares are held by institutional investors. Comparatively, 69.0% of shares of all “Restaurants & Bars” companies are held by institutional investors. 48.2% of Diversified Restaurant Holdings shares are held by insiders. Comparatively, 20.6% of shares of all “Restaurants & Bars” companies are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Volatility & Risk
Diversified Restaurant Holdings has a beta of 1.38, suggesting that its share price is 38% more volatile than the S&P 500. Comparatively, Diversified Restaurant Holdings’ peers have a beta of 0.67, suggesting that their average share price is 33% less volatile than the S&P 500.
Valuation and Earnings
This table compares Diversified Restaurant Holdings and its peers revenue, earnings per share (EPS) and valuation.
|Gross Revenue||EBITDA||Price/Earnings Ratio|
|Diversified Restaurant Holdings||$166.70 million||$20.34 million||-9.23|
|Diversified Restaurant Holdings Competitors||$2.04 billion||$349.24 million||-4.54|
Diversified Restaurant Holdings’ peers have higher revenue and earnings than Diversified Restaurant Holdings. Diversified Restaurant Holdings is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.
Diversified Restaurant Holdings peers beat Diversified Restaurant Holdings on 7 of the 12 factors compared.
About Diversified Restaurant Holdings
Diversified Restaurant Holdings, Inc. (DRH) is a restaurant company. The Company is a franchisee of Buffalo Wild Wings (BWW).As of September 25, 2016, the Company operated 64 BWW restaurants, which are located in Michigan, Florida, Missouri, Illinois and Indiana. The BWW restaurants feature a range of menu items with a multimedia social environment, a bar and an open layout designed to create a dining experience for sports fans and families. Its guests have the option of watching various sporting events on projection screens or televisions. As of September 25, 2016, the BWW menu specialized in 21 sauces and seasonings with flavors ranging from Sweet BBQ to Blazin’. As of September 25, 2016, the restaurants offered 12 to 30 domestic and imported beers on tap, including several local or regional microbrews and a selection of bottled beer, wine and liquor.
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