Nathan’s Famous (NASDAQ:NATH) and Dine Brands Global (NASDAQ:DIN) Head-To-Head Analysis

Nathan’s Famous (NASDAQ:NATH) and Dine Brands Global (NYSE:DIN) are both small-cap retail/wholesale companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, dividends, earnings, profitability, analyst recommendations, valuation and risk.

Profitability

This table compares Nathan’s Famous and Dine Brands Global’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Nathan’s Famous 20.70% -19.80% 13.44%
Dine Brands Global 11.46% -57.98% 6.23%

Valuation & Earnings

This table compares Nathan’s Famous and Dine Brands Global’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Nathan’s Famous $101.85 million 3.05 $21.49 million N/A N/A
Dine Brands Global $780.93 million 1.78 $80.35 million $5.37 15.42

Dine Brands Global has higher revenue and earnings than Nathan’s Famous.

Institutional & Insider Ownership

41.6% of Nathan’s Famous shares are owned by institutional investors. 31.8% of Nathan’s Famous shares are owned by insiders. Comparatively, 2.7% of Dine Brands Global shares are owned by 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.

Volatility & Risk

Nathan’s Famous has a beta of 0.27, indicating that its stock price is 73% less volatile than the S&P 500. Comparatively, Dine Brands Global has a beta of 0.4, indicating that its stock price is 60% less volatile than the S&P 500.

Dividends

Nathan’s Famous pays an annual dividend of $1.40 per share and has a dividend yield of 1.9%. Dine Brands Global pays an annual dividend of $2.76 per share and has a dividend yield of 3.3%. Dine Brands Global pays out 51.4% of its earnings in the form of a dividend.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Nathan’s Famous and Dine Brands Global, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Nathan’s Famous 0 0 0 0 N/A
Dine Brands Global 0 0 6 0 3.00

Dine Brands Global has a consensus price target of $101.67, indicating a potential upside of 22.82%. Given Dine Brands Global’s higher probable upside, analysts clearly believe Dine Brands Global is more favorable than Nathan’s Famous.

Summary

Nathan’s Famous beats Dine Brands Global on 8 of the 14 factors compared between the two stocks.

Nathan’s Famous Company Profile

Nathan's Famous, Inc., together with its subsidiaries, operates in the foodservice industry. The company owns and franchises restaurants under the Nathan's Famous brand name, as well as sells products bearing the Nathan's Famous trademarks through various channels of distribution. It also has license agreements for the manufacture, distribution, marketing, and sale of Nathan's Famous branded hot dogs, sausages, and corned beef products in refrigerated consumer packages to be resold through retail channels, such as supermarkets, groceries, mass merchandisers, and club stores; and other Nathan's Famous branded refrigerated meat products in consumer packages to be resold through retail channels. In addition, the company has license agreements to manufacture Nathan's Famous branded hot dog and sausage products in bulk for use in the food service industry; for supplying Nathan's Famous natural casing and skinless hot dogs in bulk for use in the Nathan's Famous restaurant system; to manufacture proprietary spices; to manufacture and sell various products, including mustard, salsa, sauerkraut, and pickles; to produce and sell French fries and onion rings for retail sale; and to manufacture and sell miniature bagel dogs, franks-in-a-blanket, and other hors d'oeuvres through club stores, supermarkets, and other retail food stores. Further, the company sells Nathan's products directly to end users or to various foodservice distributors, as well as provides Arthur Treacher's brand fish fillets. As of March 25, 2018, its restaurant system consisted of 5 company-owned units in the New York City metropolitan area; and 276 franchised units located in 20 states and 12 foreign countries. Nathan's Famous, Inc. was founded in 1916 and is based in Jericho, New York.

Dine Brands Global Company Profile

Dine Brands Global, Inc., together with its subsidiaries, owns, franchises, operates, and rents full-service restaurants in the United States and internationally. It operates in five segments: Applebee's Franchise Operations, IHOP Franchise Operations, Rental Operations, Financing Operations, and Company-Operated Restaurant Operations. The company owns and franchises two restaurant concepts, including Applebee's Neighborhood Grill + Bar (Applebee's) in the bar and grill segment of the casual dining category; and International House of Pancakes (IHOP) in the family dining category of the restaurant industry. Its Applebee's restaurants offer American fare with drinks and drafts; and IHOP restaurants provide full table services, and food and beverage offerings. As of December 31, 2018, the company had 1,768 Applebee's franchised restaurants, and 1,831 IHOP franchised and area licensed restaurants. It is also involved in the lease or sublease of 676 IHOP franchised restaurants and 1 Applebee's franchised restaurant; and the financing of franchise fees and equipment leases. The company was formerly known as DineEquity, Inc. and changed its name to Dine Brands Global, Inc. in February 2018. Dine Brands Global, Inc. was founded in 1958 and is based in Glendale, California.

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