Wendys (NASDAQ: WEN) and Jamba (NASDAQ:JMBA) are both cyclical consumer goods & services companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, valuation, earnings, analyst recommendations, institutional ownership, profitability and risk.
Risk & Volatility
Wendys has a beta of 0.93, indicating that its share price is 7% less volatile than the S&P 500. Comparatively, Jamba has a beta of 0.2, indicating that its share price is 80% less volatile than the S&P 500.
This table compares Wendys and Jamba’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a breakdown of current ratings and price targets for Wendys and Jamba, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Wendys currently has a consensus price target of $17.00, suggesting a potential downside of 1.39%. Given Wendys’ higher probable upside, research analysts clearly believe Wendys is more favorable than Jamba.
Earnings & Valuation
This table compares Wendys and Jamba’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Wendys||$1.44 billion||2.91||$129.62 million||$0.25||68.96|
|Jamba||$161.68 million||0.89||$9.41 million||($1.03)||-9.14|
Wendys has higher revenue and earnings than Jamba. Jamba is trading at a lower price-to-earnings ratio than Wendys, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
76.3% of Wendys shares are held by institutional investors. Comparatively, 92.8% of Jamba shares are held by institutional investors. 26.5% of Wendys shares are held by insiders. Comparatively, 15.9% of Jamba shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Wendys pays an annual dividend of $0.28 per share and has a dividend yield of 1.6%. Jamba does not pay a dividend. Wendys pays out 112.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Wendys beats Jamba on 13 of the 15 factors compared between the two stocks.
The Wendy’s Company is the parent company of subsidiary holding company Wendy’s Restaurants, LLC (Wendy’s Restaurants). Wendy’s Restaurants is the parent company of Wendy’s International, LLC (Wendy’s), which is the owner and franchisor of the Wendy’s restaurant system in the United States. Wendy’s is a restaurant company specializing in the hamburger sandwich segment. Wendy’s is engaged in the business of operating, developing and franchising a system of restaurants serving food. The Company operated approximately 6,080 Wendy’s restaurants in operation in North America, as of January 1, 2017. Of these restaurants, 330 were operated by the Company and 5,768 by a total of 376 franchisees, as of January 1, 2017. In addition, as of January 1, 2017, there were 439 franchised Wendy’s restaurants in operation in 29 countries and territories other than North America. Wendy’s is also a partner in a restaurant real estate joint venture with a subsidiary of Restaurant Brands International Inc.
Jamba, Inc. is a restaurant retailer of specialty food and beverage offerings. The Company operates through retail segment. The Company’s offerings include whole fruit smoothies, squeezed juices and juice blends, Energy Bowls, and a range of food items including, hot oatmeal, breakfast wraps, sandwiches, Artisan Flatbreads, baked goods and snacks. The Company, through its subsidiary, Jamba Juice Company, operates a lifestyle brand. The Company has a global business driven by a portfolio of franchised and company-owned Jamba Juice stores, and licensed JambaGO and Jamba Juice Express formats. The Company has approximately 890 Jamba Juice stores globally, consisting of over 70 company-owned and operated stores, all located in the United States (Company Stores), approximately 740 franchisee-owned and operated stores (Franchise Stores) in the United States, and over 70 Franchise Stores in international locations (International Stores), collectively the (Jamba System).
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