Comparing Chuy’s Holdings (CHUY) & Zoe’s Kitchen (ZOES)

Chuy’s Holdings (NASDAQ: CHUY) and Zoe’s Kitchen (NYSE:ZOES) are both small-cap retail/wholesale companies, but which is the superior stock? We will compare the two businesses based on the strength of their risk, earnings, profitability, institutional ownership, dividends, analyst recommendations and valuation.

Insider & Institutional Ownership

100.0% of Chuy’s Holdings shares are owned by institutional investors. 3.3% of Chuy’s Holdings shares are owned by insiders. Comparatively, 3.0% of Zoe’s Kitchen shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Chuy’s Holdings and Zoe’s Kitchen’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Chuy’s Holdings 4.86% 11.16% 7.30%
Zoe’s Kitchen -0.07% -0.27% -0.16%

Analyst Recommendations

This is a summary of recent recommendations for Chuy’s Holdings and Zoe’s Kitchen, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Chuy’s Holdings 0 7 2 0 2.22
Zoe’s Kitchen 1 6 3 0 2.20

Chuy’s Holdings currently has a consensus price target of $26.89, suggesting a potential upside of 18.98%. Zoe’s Kitchen has a consensus price target of $17.55, suggesting a potential upside of 41.99%. Given Zoe’s Kitchen’s higher probable upside, analysts plainly believe Zoe’s Kitchen is more favorable than Chuy’s Holdings.

Risk and Volatility

Chuy’s Holdings has a beta of -0.03, indicating that its stock price is 103% less volatile than the S&P 500. Comparatively, Zoe’s Kitchen has a beta of 0.34, indicating that its stock price is 66% less volatile than the S&P 500.

Valuation & Earnings

This table compares Chuy’s Holdings and Zoe’s Kitchen’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Chuy’s Holdings $346.03 million 1.10 $41.16 million $0.99 22.83
Zoe’s Kitchen $294.14 million 0.82 $22.57 million ($0.02) -618.00

Chuy’s Holdings has higher revenue and earnings than Zoe’s Kitchen. Zoe’s Kitchen is trading at a lower price-to-earnings ratio than Chuy’s Holdings, indicating that it is currently the more affordable of the two stocks.

Summary

Chuy’s Holdings beats Zoe’s Kitchen on 10 of the 13 factors compared between the two stocks.

Chuy’s Holdings Company Profile

Chuy’s Holdings, Inc. operates Chuy’s, a restaurant concept offering a distinct menu of authentic, freshly prepared Mexican and Tex-Mex inspired food. As of December 25, 2016, the Company operated 80 Chuy’s restaurants across 16 states. The Company offers the same menu during lunch and dinner, which includes enchiladas, fajitas, tacos, burritos, combination platters and daily specials, complemented by a range of appetizers, soups and salads. Each of the Company’s restaurants offers a range of homemade sauces, including the signature Hatch green chile and creamy jalapeno sauces. The Company also offers a full-service bar in all of its restaurants providing its customers a range of beverage offerings, featuring a selection of specialty cocktails including its signature on-the-rocks margaritas made with fresh, hand-squeezed lime juice, and the Texas Martini, a made-to-order, hand-shaken cocktail served with jalapeno-stuffed olives.

Zoe’s Kitchen Company Profile

Zoe’s Kitchen, Inc. develops and operates fast-casual restaurants serving a menu of fresh, wholesome, Mediterranean-inspired dishes delivered with Southern hospitality. The Company’s menu offers meals made from scratch using produce, proteins and other ingredients, including its appetizers, soups, salads and kabobs. Its food, including both hot and cold items, is suited for catering to a range of business and social occasions. It caters to a range of dietary needs by offering vegetarian, vegan, gluten-free and its calorie conscious, Simply 500 menu selections. Its party packs serve groups of approximately 10 and are each filled with their own combination of fresh fruits, veggies, proteins and grains. The Company serves dishes for various occasions, such as Guilt-Free Girls Night, Game Day Goodies, Shower Sensations and Kids’ Party Pack. As of December 26, 2016, it had operated 201 Company-owned restaurants and three franchise restaurants in 20 states across the United States.

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