Carrols Restaurant Group (TAST) vs. Noodles & Co (NDLS) Financial Comparison

Carrols Restaurant Group (NASDAQ: TAST) and Noodles & Co (NASDAQ:NDLS) are both small-cap cyclical consumer goods & services companies, but which is the superior business? We will compare the two businesses based on the strength of their valuation, earnings, risk, analyst recommendations, dividends, institutional ownership and profitability.

Earnings and Valuation

This table compares Carrols Restaurant Group and Noodles & Co’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Carrols Restaurant Group $943.58 million 0.51 $45.47 million $0.54 24.54
Noodles & Co $487.47 million 0.47 -$71.67 million ($3.04) -1.89

Carrols Restaurant Group has higher revenue and earnings than Noodles & Co. Noodles & Co is trading at a lower price-to-earnings ratio than Carrols Restaurant Group, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

88.5% of Carrols Restaurant Group shares are held by institutional investors. Comparatively, 66.7% of Noodles & Co shares are held by institutional investors. 5.6% of Carrols Restaurant Group shares are held by insiders. Comparatively, 52.7% of Noodles & Co shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Risk and Volatility

Carrols Restaurant Group has a beta of 0.17, meaning that its stock price is 83% less volatile than the S&P 500. Comparatively, Noodles & Co has a beta of -0.43, meaning that its stock price is 143% less volatile than the S&P 500.

Profitability

This table compares Carrols Restaurant Group and Noodles & Co’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Carrols Restaurant Group 3.13% 4.61% 1.36%
Noodles & Co -17.41% -6.83% -1.19%

Analyst Ratings

This is a breakdown of recent ratings for Carrols Restaurant Group and Noodles & Co, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Carrols Restaurant Group 0 0 3 0 3.00
Noodles & Co 1 5 1 0 2.00

Carrols Restaurant Group currently has a consensus target price of $15.33, indicating a potential upside of 15.72%. Noodles & Co has a consensus target price of $5.00, indicating a potential downside of 13.04%. Given Carrols Restaurant Group’s stronger consensus rating and higher probable upside, analysts plainly believe Carrols Restaurant Group is more favorable than Noodles & Co.

Summary

Carrols Restaurant Group beats Noodles & Co on 13 of the 14 factors compared between the two stocks.

About Carrols Restaurant Group

Carrols Restaurant Group, Inc. is a holding company and conducts all of its operations through its subsidiary, Carrols Corporation (Carrols) and Carrols’ subsidiary, Carrols LLC. The Company is a restaurant company and Burger King franchisee in the United States. As of January 1, 2017, the Company had owned and operated 753 Burger King restaurants under the name Burger King in 16 Northeastern, Midwestern and Southeastern states. Burger King restaurants feature the flame-broiled Whopper sandwich, as well as a range of hamburgers, chicken and other specialty sandwiches, French fries, salads, breakfast items, hot dogs, snacks, smoothies, frappes and other offerings. The Company’s Burger King restaurants are located in various states, such as Illinois, Indiana, Kentucky, Maine, Massachusetts, Michigan, New Jersey, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Tennessee, Vermont, Virginia and West Virginia.

About Noodles & Co

Noodles & Company develops and operates fast casual restaurants. The Company’s menu includes a range of cooked-to-order dishes, including noodles and pasta, soups, salads, sandwiches and appetizers. The Company has approximately 490 restaurants, including 420 Company-owned and 70 franchised locations, across 40 states, the District of Columbia and one Canadian province. The Company offers over 30 globally inspired Asian, Mediterranean and American dishes together on a single menu. The Company offers approximately 10 fresh vegetables and six proteins, including marinated steak, naturally raised pork, chicken, meatballs, shrimp and organic tofu. The Company offers Kids Meals, which includes sides, such as broccoli, carrots, fruit, applesauce and a portion of its housemade rice crispy treat. The Company’s restaurants’ locations include Arizona, California, Colorado, Delaware, New York, North Dakota, Ohio, Texas, Utah, Virginia, Washington and Wisconsin.

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