Fiesta Restaurant Group (NASDAQ: FRGI) and Bloomin’ Brands (NASDAQ:BLMN) are both small-cap cyclical consumer goods & services companies, but which is the superior investment? We will compare the two companies based on the strength of their dividends, valuation, institutional ownership, risk, profitability, earnings and analyst recommendations.

Valuation & Earnings

This table compares Fiesta Restaurant Group and Bloomin’ Brands’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Fiesta Restaurant Group $711.77 million 0.64 $16.71 million ($0.86) -19.48
Bloomin’ Brands $4.25 billion 0.36 $41.74 million $0.77 22.05

Bloomin’ Brands has higher revenue and earnings than Fiesta Restaurant Group. Fiesta Restaurant Group is trading at a lower price-to-earnings ratio than Bloomin’ Brands, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent recommendations for Fiesta Restaurant Group and Bloomin’ Brands, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Fiesta Restaurant Group 1 5 1 0 2.00
Bloomin’ Brands 1 7 3 0 2.18

Fiesta Restaurant Group presently has a consensus target price of $21.60, indicating a potential upside of 28.96%. Bloomin’ Brands has a consensus target price of $21.00, indicating a potential upside of 23.67%. Given Fiesta Restaurant Group’s higher possible upside, equities research analysts clearly believe Fiesta Restaurant Group is more favorable than Bloomin’ Brands.

Dividends

Bloomin’ Brands pays an annual dividend of $0.32 per share and has a dividend yield of 1.9%. Fiesta Restaurant Group does not pay a dividend. Bloomin’ Brands pays out 41.6% of its earnings in the form of a dividend.

Insider & Institutional Ownership

94.3% of Fiesta Restaurant Group shares are owned by institutional investors. 2.2% of Fiesta Restaurant Group shares are owned by company insiders. Comparatively, 7.0% of Bloomin’ Brands shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Fiesta Restaurant Group and Bloomin’ Brands’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Fiesta Restaurant Group -5.20% -13.51% -7.85%
Bloomin’ Brands 1.93% 94.30% 5.15%

Volatility & Risk

Fiesta Restaurant Group has a beta of 0.69, suggesting that its stock price is 31% less volatile than the S&P 500. Comparatively, Bloomin’ Brands has a beta of 0.54, suggesting that its stock price is 46% less volatile than the S&P 500.

Summary

Bloomin’ Brands beats Fiesta Restaurant Group on 10 of the 16 factors compared between the two stocks.

Fiesta Restaurant Group Company Profile

Fiesta Restaurant Group, Inc. owns, operates and franchises two fast-casual restaurant brands, Pollo Tropical and Taco Cabana through its subsidiaries Pollo Operations, Inc., and its subsidiaries, and Pollo Franchise, Inc., (collectively Pollo Tropical) and Taco Cabana, Inc. and its subsidiaries (collectively Taco Cabana). The Company operates through the Pollo Tropical and Taco Cabana segments. The Company’s Pollo Tropical restaurants offer Caribbean menu items, featuring its bone-in chicken marinated in blend of tropical fruit juices and grilled over an open flame. The Company also offers catering for parties and corporate events. The Company’s Taco Cabana restaurants serves Mexican food, including flame-grilled steak and chicken fajitas served on sizzling iron skillets, quesadillas, hand-rolled flautas, enchiladas, burritos, tacos, fresh-made flour tortillas, customizable salads served in its Cabana Bowl, and its breakfast tacos.

Bloomin’ Brands Company Profile

Bloomin’ Brands, Inc. is a holding company. The Company owns and operates casual, upscale casual and fine dining restaurants. The Company operates through two segments: U.S. and International. The U.S. segment includes all brands operating in the United States. The International segment includes brands operating outside the United States. As of December 25, 2016, the Company had a portfolio of four restaurant concepts: Outback Steakhouse, Carrabba’s Italian Grill, Bonefish Grill, and Fleming’s Prime Steakhouse & Wine Bar. OSI Restaurant Partners, LLC (OSI) is the Company’s primary operating entity. New Private Restaurant Properties, LLC (PRP), an indirect subsidiary of the Company, leases the Company-owned restaurant properties to OSI’s subsidiaries. As of December 25, 2016, the Company owned and operated 1,276 restaurants and franchised 240 restaurants across 48 states, Puerto Rico, Guam and 20 countries.

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