Comparing Kura Sushi USA (NASDAQ:KRUS) and Aramark (NYSE:ARMK)

Aramark (NYSE:ARMK) and Kura Sushi USA (NASDAQ:KRUS) are both consumer discretionary companies, but which is the superior investment? We will compare the two companies based on the strength of their risk, analyst recommendations, valuation, profitability, dividends, institutional ownership and earnings.

Institutional and Insider Ownership

65.5% of Kura Sushi USA shares are held by institutional investors. 2.8% of Aramark shares are held by insiders. Comparatively, 2.3% of Kura Sushi USA shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Volatility and Risk

Aramark has a beta of 1.1, indicating that its share price is 10% more volatile than the S&P 500. Comparatively, Kura Sushi USA has a beta of 1.38, indicating that its share price is 38% more volatile than the S&P 500.

Valuation & Earnings

This table compares Aramark and Kura Sushi USA”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Aramark	$18.51 billion	0.77	$326.39 million	$1.43	37.91
Kura Sushi USA	$328.28 million	1.03	-$4.64 million	($0.38)	-73.55

Aramark has higher revenue and earnings than Kura Sushi USA. Kura Sushi USA is trading at a lower price-to-earnings ratio than Aramark, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Aramark and Kura Sushi USA’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Aramark	1.93%	17.68%	4.21%
Kura Sushi USA	-1.41%	-0.85%	-0.42%

Analyst Recommendations

This is a breakdown of recent recommendations for Aramark and Kura Sushi USA, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Aramark	0	2	13	0	2.87
Kura Sushi USA	1	6	4	1	2.42

Aramark currently has a consensus price target of $69.25, indicating a potential upside of 27.75%. Kura Sushi USA has a consensus price target of $60.22, indicating a potential upside of 115.46%. Given Kura Sushi USA’s higher probable upside, analysts plainly believe Kura Sushi USA is more favorable than Aramark.

Summary

Aramark beats Kura Sushi USA on 9 of the 14 factors compared between the two stocks.

About Aramark

Aramark provides food and facilities management services to organizations around the world. Its clients include schools and universities, hospitals and other healthcare providers, businesses, sports and entertainment venues, and correctional institutions. The company plans and operates dining programs, including meal preparation, catering, concessions, and retail food services. It also provides facilities services such as maintenance, cleaning, and related operational support tailored to client needs.

About Kura Sushi USA

Kura Sushi USA, Inc. operates technology-enabled Japanese restaurants in the United States under the Kura Revolving Sushi Bar brand. Its restaurants feature a conveyor-belt dining format in which customers select dishes as they pass by, along with touchscreen ordering and automated systems designed to support restaurant operations. The company’s menu includes a variety of sushi and other Japanese dishes, including nigiri, rolls, sashimi, appetizers, desserts and beverages. Kura Sushi USA also incorporates interactive elements into the dining experience, such as its Bikkura-Pon reward system, which offers customers games and prizes based on returned plates.