Ruby Tuesday (NYSE: RT) and Bojangles’ (NASDAQ:BOJA) are both small-cap retail/wholesale companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, earnings, analyst recommendations, institutional ownership, risk, profitability and dividends.
Valuation & Earnings
This table compares Ruby Tuesday and Bojangles”s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Ruby Tuesday||$912.62 million||0.16||$37.10 million||($1.26)||-1.89|
|Bojangles’||$538.50 million||0.83||$79.81 million||$0.95||12.79|
Bojangles’ has higher revenue, but lower earnings than Ruby Tuesday. Ruby Tuesday is trading at a lower price-to-earnings ratio than Bojangles’, indicating that it is currently the more affordable of the two stocks.
This is a summary of current recommendations and price targets for Ruby Tuesday and Bojangles’, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Bojangles’ has a consensus target price of $18.13, suggesting a potential upside of 49.18%. Given Bojangles”s higher possible upside, analysts clearly believe Bojangles’ is more favorable than Ruby Tuesday.
Volatility & Risk
Ruby Tuesday has a beta of 0.49, suggesting that its stock price is 51% less volatile than the S&P 500. Comparatively, Bojangles’ has a beta of 1.97, suggesting that its stock price is 97% more volatile than the S&P 500.
Insider and Institutional Ownership
75.8% of Ruby Tuesday shares are held by institutional investors. Comparatively, 91.4% of Bojangles’ shares are held by institutional investors. 4.8% of Ruby Tuesday shares are held by insiders. Comparatively, 55.3% of Bojangles’ 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 table compares Ruby Tuesday and Bojangles”s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Bojangles’ beats Ruby Tuesday on 11 of the 12 factors compared between the two stocks.
Ruby Tuesday Company Profile
Ruby Tuesday, Inc. owns and operates Ruby Tuesday casual dining and Lime Fresh Mexican Grill (Lime Fresh) casual restaurants. The Company also franchises the Ruby Tuesday concept in selected domestic and international markets, and the Lime Fresh concept in selected domestic markets. Its segments include Ruby Tuesday concept and Lime Fresh concept. As of March 1, 2016, the Company operated 729 Ruby Tuesday restaurants in 44 states, 13 foreign countries, and Guam, and there were 16 Lime Fresh restaurants in two states. Of those restaurants, it owned and operated approximately 649 Ruby Tuesday restaurants and franchised over 80 Ruby Tuesday restaurants, which consisted of 28 domestic and 52 international restaurants. It also owned and operated over eight Lime Fresh restaurants and franchised eight Lime Fresh domestic restaurants. The Company’s corporate-owned and operated restaurants are concentrated primarily in the Southeast, Northeast, Mid-Atlantic and Midwest of the United States.
Bojangles’ Company Profile
Bojangles’, Inc. is a restaurant operator and franchisor. The Company offers food made from its Southern recipes. The Company’s menu includes its made-from-scratch, buttermilk biscuits baked fresh every 20 minutes; its fresh, never-frozen bone-in fried chicken; its fixin’s; its Bo-Smart menu featuring items, such as salads, grilled chicken sandwiches, roasted chicken bites and fat-free green beans; its freshly baked and delicious sweets menu, and its Legendary Iced Tea. The Company’s food is offered a la carte and in combos. The Company’s chicken, fixin’s, biscuits and Legendary Iced Tea may also be ordered in boxes or family meals, and larger combinations may be offered as tailgate specials or may be packaged in its Big Bo Box. The Company offers Southern style mac ‘n cheese made from two cheeses; fat-free green beans; cole slaw, and mashed potatoes with gravy. Its menu also features salads, sandwiches and its whole meat Roasted Chicken Bites.
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