Greene King (GKNGY) & Shake Shack (SHAK) Head-To-Head Analysis

Greene King (OTCMKTS: GKNGY) and Shake Shack (NYSE:SHAK) are both small-cap retail/wholesale companies, but which is the better stock? We will contrast the two companies based on the strength of their valuation, dividends, risk, institutional ownership, earnings, analyst recommendations and profitability.

Profitability

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This table compares Greene King and Shake Shack’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Greene King N/A N/A N/A
Shake Shack -0.63% 9.47% 3.82%

Insider and Institutional Ownership

82.4% of Shake Shack shares are held by institutional investors. 34.9% of Shake Shack 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.

Dividends

Greene King pays an annual dividend of $0.87 per share and has a dividend yield of 7.0%. Shake Shack does not pay a dividend. Greene King pays out 47.5% of its earnings in the form of a dividend.

Analyst Ratings

This is a summary of recent ratings for Greene King and Shake Shack, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Greene King 0 0 0 0 N/A
Shake Shack 1 4 3 0 2.25

Shake Shack has a consensus price target of $40.63, indicating a potential downside of 5.85%. Given Shake Shack’s higher probable upside, analysts plainly believe Shake Shack is more favorable than Greene King.

Earnings & Valuation

This table compares Greene King and Shake Shack’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Greene King $2.87 billion 0.67 $196.23 million $1.83 6.78
Shake Shack $358.81 million 4.42 -$320,000.00 $0.57 75.70

Greene King has higher revenue and earnings than Shake Shack. Greene King is trading at a lower price-to-earnings ratio than Shake Shack, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Greene King has a beta of 0.3, suggesting that its stock price is 70% less volatile than the S&P 500. Comparatively, Shake Shack has a beta of 1.29, suggesting that its stock price is 29% more volatile than the S&P 500.

Summary

Shake Shack beats Greene King on 9 of the 14 factors compared between the two stocks.

About Greene King

Greene King plc operates as a pub retailer and brewer in the United Kingdom. The company operates through Pub Company, Pub Partners, and Brewing & Brands segments. Its retail brands and formats include Greene King Local Pubs, Hungry Horse, Flaming Grill, Farmhouse Inns, and Chef & Brewer. The company is also involved in brewing, marketing, and selling beer under the Greene King IPA, Old Speckled Hen, Abbot Ale, and Belhaven Best brands. In addition, Greene King plc engages in the employment, financing, pension trustee, and property businesses. It operates 2,924 pubs, restaurants, and hotels across England, Wales, and Scotland, including 1,769 retail pubs, restaurants, and hotels, and 1,155 tenanted, leased, and franchised pubs. Greene King plc was founded in 1799 and is headquartered in Bury St Edmunds, the United Kingdom.

About Shake Shack

Shake Shack Inc. owns, operates, and licenses Shake Shack restaurants (Shacks) in the United States and internationally. Its Shacks offers hamburgers, hot dogs, chicken, crinkle cut fries, shakes, frozen custard, beer, wine, and other products. As of December 27, 2017, it had 159 Shacks, including 90 domestic company-operated Shacks, 10 domestic licensed Shacks, and 59 international licensed Shacks. Shake Shack Inc. was founded in 2004 and is headquartered in New York, New York.

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