Head to Head Review: Arc Group (OTCMKTS:RLLY) vs. Cheesecake Factory (NASDAQ:CAKE)

Cheesecake Factory (NASDAQ:CAKE) and Arc Group (OTCMKTS:RLLY) are both retail/wholesale companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, risk, profitability, institutional ownership, earnings, analyst recommendations and valuation.

Earnings and Valuation

This table compares Cheesecake Factory and Arc Group”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Cheesecake Factory	$3.75 billion	1.00	$148.43 million	$3.42	22.01
Arc Group	N/A	N/A	N/A	N/A	N/A

Cheesecake Factory has higher revenue and earnings than Arc Group.

Profitability

This table compares Cheesecake Factory and Arc Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Cheesecake Factory	4.34%	43.74%	5.81%
Arc Group	N/A	N/A	N/A

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Cheesecake Factory and Arc Group, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cheesecake Factory	3	9	6	0	2.17
Arc Group	0	0	0	0	0.00

Cheesecake Factory presently has a consensus price target of $64.94, suggesting a potential downside of 13.73%. Given Arc Group’s higher possible upside, analysts clearly believe Arc Group is more favorable than Cheesecake Factory.

Institutional & Insider Ownership

94.5% of Cheesecake Factory shares are owned by institutional investors. 8.0% of Cheesecake Factory shares are owned by company insiders. Comparatively, 12.4% of Arc Group shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Summary

Cheesecake Factory beats Arc Group on 7 of the 9 factors compared between the two stocks.

About Cheesecake Factory

The Cheesecake Factory Incorporated operates and licenses restaurants in the United States and Canada. The company operates bakeries that produce cheesecakes and other baked products for its restaurants, international licensees, third-party bakery customers, external foodservice operators, retailers, and distributors. It operates restaurants under the brands comprising The Cheesecake Factory, North Italia, Flower Child, Fox Restaurant Concepts. The Cheesecake Factory Incorporated was founded in 1972 and is headquartered in Calabasas, California.

About Arc Group

ARC Group, Inc. engages in the operation of Dick’s Wings brand of restaurants. It offers its traditional and boneless chicken wings, hog wings, and duck wings spun in its signature sauces and seasonings. The firm oprates through the following segments; Company-Owned Restaurants and Franchise Operations. The Company-Owned Restaurants are casual dining restaurants. The Franchise Operations segment offers franchises for the Dick’s Wings brand. It also offers craft beers under the name Dick’s Craft Beers. The company was founded in April 2000 and is headquartered in Jacksonville, FL.