Chuy’s (NASDAQ:CHUY – Get Free Report) and BAB (OTCMKTS:BABB – Get Free Report) are both small-cap retail/wholesale companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, earnings, analyst recommendations, valuation, institutional ownership, dividends and risk.
Insider & Institutional Ownership
99.9% of Chuy’s shares are owned by institutional investors. 1.7% of Chuy’s shares are owned by insiders. Comparatively, 33.7% of BAB shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
Valuation and Earnings
This table compares Chuy’s and BAB’s revenue, earnings per share (EPS) and valuation.
Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
Chuy’s | $460.07 million | 1.39 | $31.51 million | $1.69 | 22.01 |
BAB | $3.51 million | 1.62 | $470,000.00 | $0.07 | 11.16 |
Volatility & Risk
Chuy’s has a beta of 1.76, indicating that its stock price is 76% more volatile than the S&P 500. Comparatively, BAB has a beta of 0.07, indicating that its stock price is 93% less volatile than the S&P 500.
Profitability
This table compares Chuy’s and BAB’s net margins, return on equity and return on assets.
Net Margins | Return on Equity | Return on Assets | |
Chuy’s | 6.58% | 13.51% | 7.13% |
BAB | 15.23% | 17.45% | 12.20% |
Analyst Recommendations
This is a breakdown of recent recommendations for Chuy’s and BAB, as reported by MarketBeat.
Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
Chuy’s | 0 | 6 | 0 | 0 | 2.00 |
BAB | 0 | 0 | 0 | 0 | N/A |
Chuy’s currently has a consensus target price of $33.25, indicating a potential downside of 10.62%. Given Chuy’s’ higher possible upside, equities research analysts plainly believe Chuy’s is more favorable than BAB.
Summary
Chuy’s beats BAB on 7 of the 12 factors compared between the two stocks.
About Chuy’s
Chuy's Holdings, Inc., through its subsidiaries, owns and operates full-service restaurants under the Chuy's name in the United States. The company was founded in 1982 and is headquartered in Austin, Texas.
About BAB
BAB, Inc. franchises and licenses bagel and muffin retail units under the Big Apple Bagels (BAB), My Favorite Muffin (MFM), and SweetDuet (SD) trade names in the United States. It's BAB franchised brand includes daily baked bagels, flavored cream cheeses, premium coffees, gourmet bagel sandwiches, and other related products; and MFM brand comprises various freshly baked muffins and coffees, as well as units operating as My Favorite Muffin Your All Day Bakery Café features specialty bagel sandwiches and related products. The company's SD brand includes frozen yogurt products. BAB, Inc. was founded in 1993 and is based in Deerfield, Illinois.
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