Head to Head Contrast: Meritage Hospitality Group (OTCMKTS:MHGU) versus Wingstop (NASDAQ:WING)

Wingstop (NASDAQ:WINGGet Free Report) and Meritage Hospitality Group (OTCMKTS:MHGUGet Free Report) are both retail/wholesale companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, profitability, valuation, risk, dividends and analyst recommendations.

Risk & Volatility

Wingstop has a beta of 1.71, suggesting that its share price is 71% more volatile than the S&P 500. Comparatively, Meritage Hospitality Group has a beta of 0.08, suggesting that its share price is 92% less volatile than the S&P 500.

Profitability

This table compares Wingstop and Meritage Hospitality Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Wingstop 16.75% -19.64% 21.36%
Meritage Hospitality Group 1.31% 7.50% 1.12%

Valuation & Earnings

This table compares Wingstop and Meritage Hospitality Group’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Wingstop $460.05 million 25.20 $70.18 million $2.81 140.79
Meritage Hospitality Group $672.49 million 0.17 $6.14 million N/A N/A

Wingstop has higher earnings, but lower revenue than Meritage Hospitality Group.

Analyst Recommendations

This is a summary of current recommendations for Wingstop and Meritage Hospitality Group, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Wingstop 0 10 8 0 2.44
Meritage Hospitality Group 0 0 1 0 3.00

Wingstop presently has a consensus price target of $331.50, indicating a potential downside of 16.21%. Meritage Hospitality Group has a consensus price target of $24.00, indicating a potential upside of 41.09%. Given Meritage Hospitality Group’s stronger consensus rating and higher probable upside, analysts clearly believe Meritage Hospitality Group is more favorable than Wingstop.

Summary

Wingstop beats Meritage Hospitality Group on 6 of the 10 factors compared between the two stocks.

About Wingstop

(Get Free Report)

Wingstop Inc., together with its subsidiaries, franchises and operates restaurants under the Wingstop brand. Its restaurants offer classic wings, boneless wings, tenders, and hand-sauced-and-tossed in various flavors, as well as chicken sandwiches with fries and hand-cut carrots and celery that are cooked-to-order. The company was founded in 1994 and is headquartered in Addison, Texas.

About Meritage Hospitality Group

(Get Free Report)

Meritage Hospitality Group Inc. operates quick-service and casual dining restaurants. The company operates restaurants under the Wendy's, Morning Belle, and Stan's Tacos, as well as Taco John's brand names in Arkansas, Connecticut, Florida, Georgia, Indiana, Massachusetts, Michigan, Missouri, Mississippi, North Carolina, South Carolina, Ohio, Oklahoma, Tennessee, Texas, and Virginia. It is also involved in franchising activities. The company was formerly known as Thomas Edison Inns, Inc. and changed its name to Meritage Hospitality Group Inc. in May 1996. Meritage Hospitality Group Inc. was incorporated in 1986 and is based in Grand Rapids, Michigan.

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