Reviewing Wendys (WEN) and Jamba (JMBA)

Wendys (NASDAQ: WEN) and Jamba (NASDAQ:JMBA) are both retail/wholesale companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, valuation, profitability, analyst recommendations, dividends, earnings and institutional ownership.

Analyst Recommendations

This is a summary of current ratings and price targets for Wendys and Jamba, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Wendys 1 8 7 0 2.38
Jamba 0 0 0 0 N/A

Wendys presently has a consensus price target of $17.00, indicating a potential downside of 1.45%. Given Wendys’ higher probable upside, research analysts clearly believe Wendys is more favorable than Jamba.

Institutional & Insider Ownership

76.3% of Wendys shares are owned by institutional investors. Comparatively, 92.8% of Jamba shares are owned by institutional investors. 26.5% of Wendys shares are owned by insiders. Comparatively, 15.9% of Jamba shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Risk & Volatility

Wendys has a beta of 0.93, meaning that its share price is 7% less volatile than the S&P 500. Comparatively, Jamba has a beta of 0.2, meaning that its share price is 80% less volatile than the S&P 500.

Profitability

This table compares Wendys and Jamba’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Wendys 5.20% 20.35% 2.53%
Jamba N/A N/A N/A

Dividends

Wendys pays an annual dividend of $0.28 per share and has a dividend yield of 1.6%. Jamba does not pay a dividend. Wendys pays out 112.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Valuation & Earnings

This table compares Wendys and Jamba’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Wendys $1.44 billion 2.91 $129.62 million $0.25 69.00
Jamba $161.68 million 0.88 $9.41 million N/A N/A

Wendys has higher revenue and earnings than Jamba.

Summary

Wendys beats Jamba on 11 of the 13 factors compared between the two stocks.

Wendys Company Profile

The Wendy’s Company is the parent company of subsidiary holding company Wendy’s Restaurants, LLC (Wendy’s Restaurants). Wendy’s Restaurants is the parent company of Wendy’s International, LLC (Wendy’s), which is the owner and franchisor of the Wendy’s restaurant system in the United States. Wendy’s is a restaurant company specializing in the hamburger sandwich segment. Wendy’s is engaged in the business of operating, developing and franchising a system of restaurants serving food. The Company operated approximately 6,080 Wendy’s restaurants in operation in North America, as of January 1, 2017. Of these restaurants, 330 were operated by the Company and 5,768 by a total of 376 franchisees, as of January 1, 2017. In addition, as of January 1, 2017, there were 439 franchised Wendy’s restaurants in operation in 29 countries and territories other than North America. Wendy’s is also a partner in a restaurant real estate joint venture with a subsidiary of Restaurant Brands International Inc.

Jamba Company Profile

Jamba, Inc. is a restaurant retailer of specialty food and beverage offerings. The Company operates through retail segment. The Company’s offerings include whole fruit smoothies, squeezed juices and juice blends, Energy Bowls, and a range of food items including, hot oatmeal, breakfast wraps, sandwiches, Artisan Flatbreads, baked goods and snacks. The Company, through its subsidiary, Jamba Juice Company, operates a lifestyle brand. The Company has a global business driven by a portfolio of franchised and company-owned Jamba Juice stores, and licensed JambaGO and Jamba Juice Express formats. The Company has approximately 890 Jamba Juice stores globally, consisting of over 70 company-owned and operated stores, all located in the United States (Company Stores), approximately 740 franchisee-owned and operated stores (Franchise Stores) in the United States, and over 70 Franchise Stores in international locations (International Stores), collectively the (Jamba System).

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