Critical Comparison: Biglari (NYSE:BH.A) and FAT Brands (NASDAQ:FATBB)

Biglari (NYSE:BH.A) and FAT Brands (NASDAQ:FATBB) are both retail/wholesale companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, valuation, analyst recommendations, earnings, institutional ownership, risk and dividends.

Institutional and Insider Ownership

7.7% of Biglari shares are held by institutional investors. 70.9% of Biglari shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Biglari and FAT Brands’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Biglari	N/A	N/A	N/A
FAT Brands	-36.77%	N/A	-16.08%

Risk and Volatility

Biglari has a beta of 0.88, meaning that its share price is 12% less volatile than the S&P 500. Comparatively, FAT Brands has a beta of 0.99, meaning that its share price is 1% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and target prices for Biglari and FAT Brands, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Biglari	0	0	0	0	0.00
FAT Brands	1	0	0	0	1.00

Earnings and Valuation

This table compares Biglari and FAT Brands”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Biglari	$362.11 million	10.76	$333.66 million	$146.34	11.68
FAT Brands	$592.65 million	0.08	-$189.85 million	($12.70)	-0.20

Biglari has higher earnings, but lower revenue than FAT Brands. FAT Brands is trading at a lower price-to-earnings ratio than Biglari, indicating that it is currently the more affordable of the two stocks.

Summary

Biglari beats FAT Brands on 8 of the 11 factors compared between the two stocks.

About Biglari

Biglari Holdings Inc., through its subsidiaries, primarily operates and franchises restaurants in the United States. The company owns, operates, and franchises restaurants under the Steak n Shake and Western Sizzlin names. As of December 31, 2019, it operated 368 Steak n Shake company-operated restaurants and 213 franchised units; and 4 Western Sizzlin company-operated restaurants and 48 franchised units. The company also engages in underwriting commercial trucking insurance, and selling physical damage and non-trucking liability insurance to truckers; and operates oil and natural gas properties offshore in the Gulf of Mexico. In addition, it publishes and sells magazines, and related publishing products under the MAXIM and Maxim brand name; and licenses media products and services, as well as is involved in the investment activities. The company was formerly known as The Steak n Shake Company and changed its name to Biglari Holdings Inc. in April 2010. Biglari Holdings Inc. was founded in 1934 and is based in San Antonio, Texas.

About FAT Brands

FAT Brands Inc., a multi-brand restaurant franchising company, acquires, develops, markets, and manages quick service, fast casual, casual dining, and polished casual dining restaurant concepts worldwide. It owns restaurant brands, including Round Table Pizza, Marble Slab Creamery, Great American Cookies, Hot Dog on a Stick, Pretzelmaker, Fazoli's, Fatburger, Johnny Rockets, Elevation Burger, Yalla Mediterranean, Buffalo's Cafe and Buffalo's Express, Hurricane Grill & Wings, Ponderosa Steakhouse/Bonanza Steakhouse, Native Grill & Wings, Smokey Bones, and Twin Peaks. The company was incorporated in 2017 and is headquartered in Beverly Hills, California. FAT Brands Inc. is a subsidiary of Fog Cutter Holdings, LLC.