Contrasting Biglari (NYSE:BH.A) & Nathan’s Famous (NASDAQ:NATH)

Biglari (NYSE:BH.A) and Nathan’s Famous (NASDAQ:NATH) are both retail/wholesale companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, earnings, analyst recommendations, valuation, institutional ownership, dividends and risk.

Profitability

This table compares Biglari and Nathan’s Famous’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Biglari	N/A	N/A	N/A
Nathan’s Famous	15.74%	-143.21%	42.41%

Institutional & Insider Ownership

7.7% of Biglari shares are held by institutional investors. Comparatively, 66.5% of Nathan’s Famous shares are held by institutional investors. 70.9% of Biglari shares are held by insiders. Comparatively, 30.7% of Nathan’s Famous shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Volatility and Risk

Biglari has a beta of 0.86, suggesting that its share price is 14% less volatile than the S&P 500. Comparatively, Nathan’s Famous has a beta of 0.38, suggesting that its share price is 62% less volatile than the S&P 500.

Earnings & Valuation

This table compares Biglari and Nathan’s Famous”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Biglari	$362.11 million	10.93	$333.66 million	$146.34	11.86
Nathan’s Famous	$150.41 million	2.89	$24.03 million	$5.76	18.48

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

Analyst Ratings

This is a summary of current ratings and target prices for Biglari and Nathan’s Famous, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Biglari	0	0	0	0	0.00
Nathan’s Famous	0	0	1	0	3.00

Summary

Biglari beats Nathan’s Famous on 7 of the 13 factors compared between the two stocks.

About Biglari

Biglari Holdings Inc., through its subsidiaries, primarily operates and franchises restaurants in the United States. The company owns, operates, and franchises restaurants under the Steak n Shake and Western Sizzlin names. As of December 31, 2019, it operated 368 Steak n Shake company-operated restaurants and 213 franchised units; and 4 Western Sizzlin company-operated restaurants and 48 franchised units. The company also engages in underwriting commercial trucking insurance, and selling physical damage and non-trucking liability insurance to truckers; and operates oil and natural gas properties offshore in the Gulf of Mexico. In addition, it publishes and sells magazines, and related publishing products under the MAXIM and 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.

About Nathan’s Famous

Nathan’s Famous, Inc. engages in the operation of franchised fast-food units. It is involved in the licensing, wholesaling, and retailing of products marketed under the Nathan’s Famous brand. The firm operates through the following business segments: Branded Product Program, Product Licensing, Restaurant Operations, and Corporate. The Branded Product Program segment markets and sells hot dog products. The Product Licensing segment is composed of royalties from licensing a variety of Nathan’s Famous products such as hotdogs, sausage and corned beef products, frozen French fries, and additional products through retail grocery channels and club stores. The Restaurant Operations segment deals with the sale of products at company-owned restaurants and fees and royalties from franchised restaurants. The Corporate segment includes administrative expenses such as executive management, finance, information technology, legal, insurance, corporate office costs, corporate incentive compensation, and compliance costs. The company was founded by Nathan Handwerker in 1916 and is headquartered in Jericho, NY.