Reviewing Shake Shack (NYSE:SHAK) and TH International (NASDAQ:THCH)

Shake Shack (NYSE:SHAK) and TH International (NASDAQ:THCH) are both retail/wholesale companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, institutional ownership, risk, valuation, dividends, earnings and analyst recommendations.

Valuation and Earnings

This table compares Shake Shack and TH International”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Shake Shack	$1.25 billion	3.12	$10.21 million	$0.46	198.82
TH International	$190.59 million	0.44	-$57.32 million	($1.52)	-1.68

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

Analyst Recommendations

This is a summary of current recommendations and price targets for Shake Shack and TH International, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Shake Shack	3	13	6	1	2.22
TH International	1	0	0	0	1.00

Shake Shack presently has a consensus price target of $121.60, indicating a potential upside of 32.96%. Given Shake Shack’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Shake Shack is more favorable than TH International.

Institutional & Insider Ownership

86.1% of Shake Shack shares are owned by institutional investors. Comparatively, 91.9% of TH International shares are owned by institutional investors. 8.5% of Shake Shack shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Volatility & Risk

Shake Shack has a beta of 1.65, indicating that its stock price is 65% more volatile than the S&P 500. Comparatively, TH International has a beta of 0.54, indicating that its stock price is 46% less volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Shake Shack	1.50%	9.78%	2.83%
TH International	-26.38%	N/A	-16.11%

Summary

Shake Shack beats TH International on 14 of the 15 factors compared between the two stocks.

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.

About TH International

TH International Limited operates Tim Hortons coffee shops in mainland China, Hong Kong, and Macau. The company offers brewed tea, coffee, milk tea, lemonade, hot chocolate, and coffee drinks. It is also involved in franchise related business. The company is based in Shanghai, the People's Republic of China.