Famous Dave’s of America (DAVE) & Bob Evans Farms (BOBE) Critical Contrast

Famous Dave’s of America (NASDAQ: DAVE) and Bob Evans Farms (NASDAQ:BOBE) are both small-cap retail/wholesale companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, dividends, risk, earnings, analyst recommendations, valuation and profitabiliy.

Institutional & Insider Ownership

60.5% of Famous Dave’s of America shares are held by institutional investors. Comparatively, 78.3% of Bob Evans Farms shares are held by institutional investors. 27.0% of Famous Dave’s of America shares are held by company insiders. Comparatively, 1.2% of Bob Evans Farms shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent recommendations for Famous Dave’s of America and Bob Evans Farms, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Famous Dave’s of America	0	0	0	0	N/A
Bob Evans Farms	0	3	3	0	2.50

Bob Evans Farms has a consensus target price of $75.68, indicating a potential upside of 13.04%. Given Bob Evans Farms’ higher possible upside, analysts clearly believe Bob Evans Farms is more favorable than Famous Dave’s of America.

Dividends

Bob Evans Farms pays an annual dividend of $1.36 per share and has a dividend yield of 2.0%. Famous Dave’s of America does not pay a dividend. Bob Evans Farms pays out 21.7% of its earnings in the form of a dividend. Famous Dave’s of America has increased its dividend for 9 consecutive years.

Volatility & Risk

Famous Dave’s of America has a beta of 1.41, meaning that its share price is 41% more volatile than the S&P 500. Comparatively, Bob Evans Farms has a beta of 0.54, meaning that its share price is 46% less volatile than the S&P 500.

Earnings and Valuation

This table compares Famous Dave’s of America and Bob Evans Farms’ gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	EBITDA	Earnings Per Share	Price/Earnings Ratio
Famous Dave’s of America	$97.67 million	0.25	$2.90 million	($0.65)	-5.31
Bob Evans Farms	$394.84 million	3.38	$71.50 million	$6.27	10.68

Bob Evans Farms has higher revenue and earnings than Famous Dave’s of America. Famous Dave’s of America is trading at a lower price-to-earnings ratio than Bob Evans Farms, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Famous Dave’s of America and Bob Evans Farms’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Famous Dave’s of America	-4.59%	1.13%	0.44%
Bob Evans Farms	15.15%	19.58%	6.82%

Summary

Bob Evans Farms beats Famous Dave’s of America on 11 of the 16 factors compared between the two stocks.

About Famous Dave’s of America

Famous Dave’s of America, Inc. (Famous Dave’s) operates restaurants. The Company’s restaurants, which offer full table service, feature wood-smoked and off-the-grill entree favorites that fit into the barbeque category. It has the Company-owned and franchise-operated restaurants in the United States, the Commonwealth of Puerto Rico, and Canada, and it operates within the industry segment of foodservice. It operates approximately 179 Famous Dave’s restaurants in over 33 states, the Commonwealth of Puerto Rico and Canada, including over 44 the Company-owned restaurants and approximately 135 franchise-operated restaurants. Each restaurant features a selection of hickory-smoked and off-the-grill barbecue favorites, such as flame-grilled St. Louis-style and baby back ribs, Texas beef brisket, Georgia chopped pork, country-roasted chicken, and signature sandwiches and salads. Its restaurants offer side items, such as corn bread, potato salad, coleslaw, Shack Fries and Wilbur Beans.

About Bob Evans Farms

Bob Evans Farms, Inc. (Bob Evans) is a producer and distributor of refrigerated potato, pasta and vegetable-based side dishes, pork sausage, and a variety of refrigerated and frozen food items under the Bob Evans and Owens or Country Creek brand names. The Company’s food products are distributed to customers throughout the United States. Additionally, the Company manufactures and sells similar products to foodservice customers, restaurants and food sellers. The Company operates through BEF Foods segment. The BEF Foods segment offers a range of wholesome food products to retail and foodservice customers. The Company produces food products in its four manufacturing facilities. It produces sausage products at its plants located in Hillsdale, Michigan, and Xenia, Ohio.