Fogo De Chao (NASDAQ: FRSH) and Papa Murphy’s (NASDAQ:FRSH) are both small-cap retail/wholesale companies, but which is the better stock? We will contrast the two companies based on the strength of their valuation, risk, dividends, analyst recommendations, earnings, institutional ownership and profitability.
Valuation and Earnings
This table compares Fogo De Chao and Papa Murphy’s’ revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Fogo De Chao||$314.36 million||1.42||$28.78 million||$0.82||19.21|
|Papa Murphy’s||$118.66 million||0.77||-$10,000.00||$0.15||35.80|
Fogo De Chao has higher revenue and earnings than Papa Murphy’s. Fogo De Chao is trading at a lower price-to-earnings ratio than Papa Murphy’s, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Fogo De Chao has a beta of 0.15, indicating that its share price is 85% less volatile than the S&P 500. Comparatively, Papa Murphy’s has a beta of 0.14, indicating that its share price is 86% less volatile than the S&P 500.
This is a summary of recent ratings for Fogo De Chao and Papa Murphy’s, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Fogo De Chao||0||4||1||0||2.20|
Fogo De Chao presently has a consensus price target of $14.25, indicating a potential downside of 9.52%. Given Fogo De Chao’s higher possible upside, analysts clearly believe Fogo De Chao is more favorable than Papa Murphy’s.
Insider and Institutional Ownership
90.7% of Fogo De Chao shares are owned by institutional investors. Comparatively, 29.5% of Papa Murphy’s shares are owned by institutional investors. 82.8% of Fogo De Chao shares are owned by company insiders. Comparatively, 13.1% of Papa Murphy’s shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
This table compares Fogo De Chao and Papa Murphy’s’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Fogo De Chao||9.11%||7.56%||4.38%|
Fogo De Chao beats Papa Murphy’s on 10 of the 13 factors compared between the two stocks.
Fogo De Chao Company Profile
Fogo de Chao, Inc. is a United States-based holding company. The Company, through its subsidiaries, operates upscale Brazilian churrascaria steakhouses under the brand of Fogo de Chao. The Company owns 100% of Brasa (Purchaser) Inc. (Brasa Purchaser), which owns 100% of Brasa (Holdings) Inc. (Brasa Holdings). The Company operates through two segments: United States and Brazil. It specializes in fire-roasting meats utilizing the centuries-old Southern Brazilian cooking technique of churrasco. The Company offers its guests a tasting menu of meats featuring up to 20 cuts, simply seasoned and fire-roasted to expose their natural flavors. The Company operates approximately 26 restaurants in the United States, 10 in Brazil and one in Mexico. The Company operates a range of restaurant formats, including in-line and free-standing locations. Its restaurants range in size from approximately 7,000 to 16,000 square feet, with seating from 200 to 500 guests.
Papa Murphy’s Company Profile
Papa Murphy's Holdings, Inc., together with its subsidiaries, owns, operates, and franchises Take ?N' Bake pizza stores. The company operates in three segments: Domestic Company Stores, Domestic Franchise, and International. As of January 1, 2018, it operated approximately 1,523 stores, including 1,338 franchised and 145 company-owned stores in 39 states, as well as 14 stores in Canada and 26 stores in the Middle East. The company was founded in 1981 and is headquartered in Vancouver, Washington.
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