Chipotle Mexican Grill (NYSE:CMG) and Yum! Brands (NYSE:YUM) are both large-cap retail/wholesale companies, but which is the superior stock? We will compare the two companies based on the strength of their profitability, valuation, dividends, earnings, institutional ownership, analyst recommendations and risk.
Analyst Recommendations
This is a summary of recent ratings and recommmendations for Chipotle Mexican Grill and Yum! Brands, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Chipotle Mexican Grill | 0 | 9 | 20 | 0 | 2.69 |
| Yum! Brands | 1 | 10 | 8 | 0 | 2.37 |
Chipotle Mexican Grill currently has a consensus price target of $1,819.7586, suggesting a potential downside of 4.62%. Yum! Brands has a consensus price target of $128.0556, suggesting a potential upside of 0.27%. Given Yum! Brands' higher possible upside, analysts plainly believe Yum! Brands is more favorable than Chipotle Mexican Grill.
Insider & Institutional Ownership
90.3% of Chipotle Mexican Grill shares are held by institutional investors. Comparatively, 78.3% of Yum! Brands shares are held by institutional investors. 1.0% of Chipotle Mexican Grill shares are held by company insiders. Comparatively, 0.4% of Yum! Brands shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
Valuation and Earnings
This table compares Chipotle Mexican Grill and Yum! Brands' revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Chipotle Mexican Grill | $5.98 billion | 8.96 | $355.77 million | $10.73 | 177.95 |
| Yum! Brands | $5.65 billion | 6.69 | $904 million | $3.62 | 35.30 |
Yum! Brands has lower revenue, but higher earnings than Chipotle Mexican Grill. Yum! Brands is trading at a lower price-to-earnings ratio than Chipotle Mexican Grill, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Chipotle Mexican Grill has a beta of 1.36, indicating that its share price is 36% more volatile than the S&P 500. Comparatively, Yum! Brands has a beta of 1.09, indicating that its share price is 9% more volatile than the S&P 500.
Profitability
This table compares Chipotle Mexican Grill and Yum! Brands' net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Chipotle Mexican Grill | 8.57% | 28.27% | 9.50% |
| Yum! Brands | 21.21% | -16.99% | 23.24% |
Summary
Chipotle Mexican Grill beats Yum! Brands on 10 of the 14 factors compared between the two stocks.
