Shake Shack (SHAK) and Its Rivals Head-To-Head Review

Shake Shack (NYSE:SHAK) is one of 382 public companies in the “Hotels, Restaurants & Leisure” industry, but how does it weigh in compared to its competitors? We will compare Shake Shack to related companies based on the strength of its earnings, valuation, institutional ownership, dividends, profitability, risk and analyst recommendations.

Analyst Recommendations

This is a summary of current ratings for Shake Shack and its competitors, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Shake Shack	0	12	16	0	2.57
Shake Shack Competitors	3806	17282	25595	905	2.50

Shake Shack currently has a consensus price target of $87.00, suggesting a potential upside of 20.80%. As a group, “Hotels, Restaurants & Leisure” companies have a potential upside of 58.76%. Given Shake Shack’s competitors higher probable upside, analysts clearly believe Shake Shack has less favorable growth aspects than its competitors.

Volatility & Risk

Shake Shack has a beta of 1.75, indicating that its share price is 75% more volatile than the S&P 500. Comparatively, Shake Shack’s competitors have a beta of 1.44, indicating that their average share price is 44% more volatile than the S&P 500.

Valuation & Earnings

This table compares Shake Shack and its competitors top-line revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Shake Shack	$1.45 billion	$45.72 million	76.62
Shake Shack Competitors	$3.31 billion	$250.20 million	-155.59

Shake Shack’s competitors have higher revenue and earnings than Shake Shack. Shake Shack is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Profitability

This table compares Shake Shack and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Shake Shack	2.56%	9.29%	2.71%
Shake Shack Competitors	2.31%	-40.03%	2.12%

Insider & Institutional Ownership

86.1% of Shake Shack shares are owned by institutional investors. Comparatively, 48.7% of shares of all “Hotels, Restaurants & Leisure” companies are owned by institutional investors. 8.3% of Shake Shack shares are owned by company insiders. Comparatively, 22.3% of shares of all “Hotels, Restaurants & Leisure” companies are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

Shake Shack beats its competitors on 8 of the 13 factors compared.

About Shake Shack

Shake Shack Inc. owns, operates, and licenses Shake Shack restaurants (Shacks) in the United States and internationally. Its Shacks offers hamburgers, chicken, hot dogs, crinkle cut fries, shakes, frozen custard, beer, wine, and other products. The company was founded in 2001 and is headquartered in New York, New York.