El Pollo LoCo (LOCO) versus Fiesta Restaurant Group (FRGI) Head to Head Analysis

El Pollo LoCo (NASDAQ: LOCO) and Fiesta Restaurant Group (NASDAQ:FRGI) are both small-cap retail/wholesale companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, analyst recommendations, earnings, risk, institutional ownership, profitability and dividends.

Earnings & Valuation

This table compares El Pollo LoCo and Fiesta Restaurant Group’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
El Pollo LoCo $380.12 million 1.05 $18.33 million $0.22 46.82
Fiesta Restaurant Group $711.77 million 0.74 $16.71 million ($0.86) -22.56

El Pollo LoCo has higher earnings, but lower revenue than Fiesta Restaurant Group. Fiesta Restaurant Group is trading at a lower price-to-earnings ratio than El Pollo LoCo, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings and price targets for El Pollo LoCo and Fiesta Restaurant Group, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
El Pollo LoCo 0 3 1 0 2.25
Fiesta Restaurant Group 1 4 1 0 2.00

El Pollo LoCo currently has a consensus price target of $13.00, suggesting a potential upside of 26.21%. Fiesta Restaurant Group has a consensus price target of $22.60, suggesting a potential upside of 16.49%. Given El Pollo LoCo’s stronger consensus rating and higher possible upside, analysts plainly believe El Pollo LoCo is more favorable than Fiesta Restaurant Group.

Risk and Volatility

El Pollo LoCo has a beta of 0.3, suggesting that its stock price is 70% less volatile than the S&P 500. Comparatively, Fiesta Restaurant Group has a beta of 0.76, suggesting that its stock price is 24% less volatile than the S&P 500.

Profitability

This table compares El Pollo LoCo and Fiesta Restaurant Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
El Pollo LoCo 2.27% 9.14% 5.37%
Fiesta Restaurant Group -3.40% 9.49% 5.57%

Insider & Institutional Ownership

78.1% of El Pollo LoCo shares are held by institutional investors. 45.9% of El Pollo LoCo shares are held by company insiders. Comparatively, 2.2% of Fiesta Restaurant Group shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Summary

El Pollo LoCo beats Fiesta Restaurant Group on 9 of the 13 factors compared between the two stocks.

About El Pollo LoCo

El Pollo Loco Holdings, Inc. specializes in fire-grilling citrus-marinated chicken and operates in the limited service restaurant (LSR) segment. The Company’s menu features its signature product, citrus-marinated fire-grilled chicken, and a range of Mexican-inspired entrees that it creates from chicken. Every day in every restaurant, the Company marinates and fire-grills its chicken over open flames, and hand-slices whole tomatoes, avocados, serrano peppers and cilantro to make its salsas, guacamole and cilantro dressings from scratch. The Company also offers burritos, salads, tostadas, bowls, stuffed quesadillas and chicken entrees. The Company’s entrees include Chicken Avocado Burrito, Under 500 Calorie entrees, Ultimate Pollo Bowl, and Stuffed Chicken Avocado Quesadilla. As of December 28, 2016, the Company had 460 restaurants, consisting of 201 Company-operated and 259 franchised restaurants. The Company also offers additional proteins, such as shrimp, carnitas and beef.

About Fiesta Restaurant Group

Fiesta Restaurant Group, Inc. owns, operates and franchises two fast-casual restaurant brands, Pollo Tropical and Taco Cabana through its subsidiaries Pollo Operations, Inc., and its subsidiaries, and Pollo Franchise, Inc., (collectively Pollo Tropical) and Taco Cabana, Inc. and its subsidiaries (collectively Taco Cabana). The Company operates through the Pollo Tropical and Taco Cabana segments. The Company’s Pollo Tropical restaurants offer Caribbean menu items, featuring its bone-in chicken marinated in blend of tropical fruit juices and grilled over an open flame. The Company also offers catering for parties and corporate events. The Company’s Taco Cabana restaurants serves Mexican food, including flame-grilled steak and chicken fajitas served on sizzling iron skillets, quesadillas, hand-rolled flautas, enchiladas, burritos, tacos, fresh-made flour tortillas, customizable salads served in its Cabana Bowl, and its breakfast tacos.

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