Analyzing Granite City Food & Brewery (OTCMKTS:GCFB) and Mcdonald’s (OTCMKTS:MCD)

Granite City Food & Brewery (OTCMKTS:GCFB) and Mcdonald’s (NYSE:MCD) are both retail/wholesale companies, but which is the superior stock? We will contrast the two companies based on the strength of their dividends, risk, earnings, profitability, valuation, analyst recommendations and institutional ownership.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Granite City Food & Brewery and Mcdonald’s, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Granite City Food & Brewery 0 0 0 0 N/A
Mcdonald’s 0 7 21 0 2.75

Mcdonald’s has a consensus target price of $222.35, suggesting a potential upside of 14.51%. Given Mcdonald’s’ higher possible upside, analysts clearly believe Mcdonald’s is more favorable than Granite City Food & Brewery.

Dividends

Mcdonald’s pays an annual dividend of $4.64 per share and has a dividend yield of 2.4%. Granite City Food & Brewery does not pay a dividend. Mcdonald’s pays out 58.7% of its earnings in the form of a dividend.

Institutional & Insider Ownership

67.9% of Mcdonald’s shares are owned by institutional investors. 26.3% of Granite City Food & Brewery shares are owned by company insiders. Comparatively, 0.3% of Mcdonald’s shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Granite City Food & Brewery and Mcdonald’s’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Granite City Food & Brewery $133.84 million 0.02 -$7.37 million N/A N/A
Mcdonald’s $21.03 billion 7.01 $5.92 billion $7.90 24.58

Mcdonald’s has higher revenue and earnings than Granite City Food & Brewery.

Volatility & Risk

Granite City Food & Brewery has a beta of -3.68, indicating that its stock price is 468% less volatile than the S&P 500. Comparatively, Mcdonald’s has a beta of 0.48, indicating that its stock price is 52% less volatile than the S&P 500.

Profitability

This table compares Granite City Food & Brewery and Mcdonald’s’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Granite City Food & Brewery N/A N/A N/A
Mcdonald’s 28.09% -92.46% 14.46%

Summary

Mcdonald’s beats Granite City Food & Brewery on 10 of the 13 factors compared between the two stocks.

About Granite City Food & Brewery

Granite City Food & Brewery, Ltd. operates casual dining restaurants in the United States. The company's upscale casual dining restaurants include the Granite City Food & Brewery restaurant that offers various menu items and handcrafted beers, as well as other regional craft beers; and the Cadillac Ranch All American Bar & Grill restaurant that offers American cuisine, including homemade meatloaf and pasta dishes. As of December 26, 2017, it operated 32 Granite City restaurants in 13 states; and 4 Cadillac Ranch restaurants in 4 states. The company was founded in 1997 and is headquartered in Bloomington, Minnesota. Granite City Food & Brewery, Ltd. is a subsidiary of Concept Development Partners LLC.

About Mcdonald’s

McDonald's Corporation operates and franchises McDonald's restaurants in the United States and internationally. Its restaurants offer various food products, soft drinks, coffee, and other beverages, as well as breakfast menu. As of December 31, 2018, the company operated 37,855 restaurants, including 35,085 franchised restaurants comprising 21,685 franchised to conventional franchisees, 7,225 licensed to developmental licensees, and 6,175 licensed to foreign affiliates; and 2,770 company-operated restaurants. McDonald's Corporation was founded in 1940 and is based in Chicago, Illinois.

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