Restaurant Brands International (NYSE:QSR) and Meritage Hospitality Group (OTCMKTS:MHGU) are both retail/wholesale companies, but which is the superior investment? We will contrast the two companies based on the strength of their earnings, dividends, profitability, institutional ownership, analyst recommendations, risk and valuation.
Insider & Institutional Ownership
77.7% of Restaurant Brands International shares are held by institutional investors. 3.7% of Restaurant Brands International shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
This is a breakdown of current ratings and price targets for Restaurant Brands International and Meritage Hospitality Group, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Restaurant Brands International||1||6||17||0||2.67|
|Meritage Hospitality Group||0||0||0||0||N/A|
Restaurant Brands International presently has a consensus price target of $63.90, suggesting a potential upside of 15.66%. Given Restaurant Brands International’s higher probable upside, research analysts clearly believe Restaurant Brands International is more favorable than Meritage Hospitality Group.
Valuation and Earnings
This table compares Restaurant Brands International and Meritage Hospitality Group’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Restaurant Brands International||$5.60 billion||2.96||$643.00 million||$2.72||20.31|
|Meritage Hospitality Group||$467.55 million||0.20||$12.06 million||N/A||N/A|
Restaurant Brands International has higher revenue and earnings than Meritage Hospitality Group.
Volatility and Risk
Restaurant Brands International has a beta of 1.38, indicating that its share price is 38% more volatile than the S&P 500. Comparatively, Meritage Hospitality Group has a beta of 0.4, indicating that its share price is 60% less volatile than the S&P 500.
This table compares Restaurant Brands International and Meritage Hospitality Group’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Restaurant Brands International||11.72%||31.08%||5.60%|
|Meritage Hospitality Group||1.01%||6.38%||0.79%|
Restaurant Brands International beats Meritage Hospitality Group on 11 of the 11 factors compared between the two stocks.
Restaurant Brands International Company Profile
Restaurant Brands International Inc. owns, operates, and franchises quick service restaurants under the Tim Hortons (TH), Burger King (BK), and Popeyes (PLK) brand names. The company operates through three segments: TH, BK, and PLK. Its restaurants offer blend coffee, tea, espresso-based hot and cold specialty drinks, donuts, Timbits, bagels, muffins, cookies and pastries, grilled paninis, classic sandwiches, wraps, soups, hamburgers, chicken and other specialty sandwiches, french fries, soft drinks, chicken, chicken tenders, fried shrimp and other seafood, red beans and rice, and other food items. As of December 31, 2018, the company owned or franchised a total of 4,846 TH restaurants, 17,796 BK restaurants, and 3,102 PLK restaurants in approximately 100 countries worldwide and U.S. territories. Restaurant Brands International Inc. was founded in 1954 and is headquartered in Toronto, Canada.
Meritage Hospitality Group Company Profile
Meritage Hospitality Group Inc. operates quick-service and casual dining restaurants. The company operates restaurants under the Wendy's, Twisted Rooster, Crooked Goose, Freighters Eatery & Taproom, and Wheelhouse Kitchen & Cocktails brand names. As of November 13, 2018, it operated 314 restaurants in Arkansas, Connecticut, Florida, Georgia, Indiana, Massachusetts, Michigan, Missouri, Mississippi, North Carolina, South Carolina, Ohio, Oklahoma, Tennessee, Texas, and Virginia. The company was formerly known as Thomas Edison Inns, Inc. and changed its name to Meritage Hospitality Group Inc. in May 1996. Meritage Hospitality Group Inc. was incorporated in 1986 and is headquartered in Grand Rapids, Michigan.
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