Sonic Drive-In (NASDAQ: SONC) and Biglari (NYSE:BH) are both small-cap retail/wholesale companies, but which is the superior stock? We will contrast the two businesses based on the strength of their risk, institutional ownership, dividends, profitability, analyst recommendations, earnings and valuation.
Institutional & Insider Ownership
91.6% of Biglari shares are held by institutional investors. 8.3% of Sonic Drive-In shares are held by company insiders. Comparatively, 54.8% of Biglari shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
Sonic Drive-In pays an annual dividend of $0.64 per share and has a dividend yield of 2.4%. Biglari does not pay a dividend. Sonic Drive-In pays out 51.2% of its earnings in the form of a dividend.
This table compares Sonic Drive-In and Biglari’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Earnings and Valuation
This table compares Sonic Drive-In and Biglari’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Sonic Drive-In||$477.27 million||2.07||$63.66 million||$1.25||21.26|
|Biglari||$839.80 million||1.05||$50.07 million||N/A||N/A|
Sonic Drive-In has higher earnings, but lower revenue than Biglari.
This is a breakdown of current ratings for Sonic Drive-In and Biglari, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Sonic Drive-In presently has a consensus target price of $28.50, indicating a potential upside of 7.22%. Given Sonic Drive-In’s higher possible upside, equities research analysts plainly believe Sonic Drive-In is more favorable than Biglari.
Volatility & Risk
Sonic Drive-In has a beta of 1.47, suggesting that its stock price is 47% more volatile than the S&P 500. Comparatively, Biglari has a beta of 0.4, suggesting that its stock price is 60% less volatile than the S&P 500.
Sonic Drive-In beats Biglari on 9 of the 14 factors compared between the two stocks.
About Sonic Drive-In
Sonic Corp. operates and franchises a chain of quick-service drive-in restaurants in the United States. As of August 31, 2017, the company operated 3,593 Sonic Drive-Ins in 45 states, of which 228 were owned and operated by the company and 3,365 were owned and operated by franchisees. The company also owns and leases 135 properties; and sublease 53 properties to franchisees and other parties. The company was founded in 1953 and is headquartered in Oklahoma City, Oklahoma.
Biglari Holdings Inc., through its subsidiaries, operates and franchises restaurants in the United States. The company owns, operates, and franchises restaurants under restaurant concepts, including Steak n Shake, an American brand serving premium burgers and milk shakes; and Western, which offers signature steak dishes and other classic American menu items, as well operates other concepts, such as Great American Steak & Buffet and Wood Grill Buffet consisting of hot and cold food buffet style dining. As of December 31, 2017, it operated 415 Steak n Shake company-operated restaurants and 200 franchised units; and 4 Western company-operated restaurants and 58 franchised units. The company also engages in underwriting commercial trucking insurance, and selling physical damage and non-trucking liability insurance to truckers. In addition, it publishes and sells magazines, and related publishing products and services in print and digital under the Maxim brand name; and licenses media products and services, as well as is involved in the investment activities. The company was formerly known as The Steak n Shake Company and changed its name to Biglari Holdings Inc. in April 2010. Biglari Holdings Inc. was founded in 1934 and is based in San Antonio, Texas.
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