Analyzing Wendy’s (NASDAQ:WEN) and Mitchells & Butlers (OTCMKTS:MBPFF)

Mitchells & Butlers (OTCMKTS:MBPFF) and Wendy’s (NASDAQ:WEN) are both retail/wholesale companies, but which is the superior business? We will compare the two companies based on the strength of their risk, institutional ownership, earnings, profitability, dividends, valuation and analyst recommendations.

Valuation & Earnings

This table compares Mitchells & Butlers and Wendy’s”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Mitchells & Butlers	$3.54 billion	0.62	$231.13 million	N/A	N/A
Wendy’s	$2.21 billion	0.72	$194.36 million	$0.94	8.91

Mitchells & Butlers has higher revenue and earnings than Wendy’s.

Risk & Volatility

Mitchells & Butlers has a beta of 0.48, suggesting that its share price is 52% less volatile than the S&P 500. Comparatively, Wendy’s has a beta of 0.39, suggesting that its share price is 61% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations and price targets for Mitchells & Butlers and Wendy’s, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Mitchells & Butlers	0	0	0	0	0.00
Wendy’s	5	17	4	1	2.04

Wendy’s has a consensus target price of $10.39, suggesting a potential upside of 23.94%. Given Wendy’s’ stronger consensus rating and higher probable upside, analysts clearly believe Wendy’s is more favorable than Mitchells & Butlers.

Insider and Institutional Ownership

86.0% of Wendy’s shares are owned by institutional investors. 17.0% of Wendy’s shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Profitability

This table compares Mitchells & Butlers and Wendy’s’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Mitchells & Butlers	N/A	N/A	N/A
Wendy’s	8.43%	125.74%	3.88%

Summary

Wendy’s beats Mitchells & Butlers on 10 of the 13 factors compared between the two stocks.

About Mitchells & Butlers

Mitchells & Butlers plc engages in the management of pubs, bars, and restaurants in the United Kingdom and Germany. The company operates its pubs and restaurants under the Alex, All Bar One, Browns, Castle, EGO, Ember Inns, Harvester, High Street, Innkeeper's Lodge, Miller & Carter, Nicholson's, O'Neill's, Premium Country Pubs, Sizzling Pubs, Suburban, Stonehouse Pizza & Carvery, Toby Carvery, and Vintage Inns brands and formats. It also engages in the leisure retailing; property leasing, property management, and development; and financing activities, as well as operates as a healthcare trustee. In addition, the company owns various trademarks. The company was founded in 1898 and is headquartered in Birmingham, the United Kingdom.

About Wendy’s

The Wendy’s Co. engages in operating, developing, and franchising a system of quick-service restaurants. It operates through the following segments: Wendy’s U.S., Wendy’s International, and Global Real Estate and Development. The Wendy’s U.S. segment includes the operation and franchising of Wendy’s restaurants in the U.S. The Wendy’s International segment is involved in the operation and franchising of Wendy’s restaurants in countries and territories other than the U.S. The Global Real Estate and Development segment focuses on real estate activity for owned sites and sites leased from third parties. The company was founded by R. David Thomas on November 15, 1969 and is headquartered in Dublin, OH.