Contrasting McDonald’s Corporation (MCD) and Noodles & (NDLS)
McDonald’s Corporation (NYSE: MCD) and Noodles & (NASDAQ:NDLS) are both retail/wholesale companies, but which is the superior business? We will compare the two companies based on the strength of their profitability, analyst recommendations, institutional ownership, risk, earnings, valuation and dividends.
This table compares McDonald’s Corporation and Noodles &’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Risk and Volatility
McDonald’s Corporation has a beta of 0.7, meaning that its stock price is 30% less volatile than the S&P 500. Comparatively, Noodles & has a beta of -0.57, meaning that its stock price is 157% less volatile than the S&P 500.
McDonald’s Corporation pays an annual dividend of $3.76 per share and has a dividend yield of 2.4%. Noodles & does not pay a dividend. McDonald’s Corporation pays out 61.5% of its earnings in the form of a dividend. Noodles & has raised its dividend for 40 consecutive years.
Earnings & Valuation
This table compares McDonald’s Corporation and Noodles &’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|McDonald’s Corporation||$24.18 billion||5.35||$9.60 billion||$6.11||26.16|
|Noodles &||$481.59 million||0.33||$12.41 million||($3.19)||-1.25|
McDonald’s Corporation has higher revenue and earnings than Noodles &. Noodles & is trading at a lower price-to-earnings ratio than McDonald’s Corporation, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
67.9% of McDonald’s Corporation shares are owned by institutional investors. Comparatively, 67.7% of Noodles & shares are owned by institutional investors. 0.2% of McDonald’s Corporation shares are owned by insiders. Comparatively, 52.7% of Noodles & shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
This is a summary of current recommendations and price targets for McDonald’s Corporation and Noodles &, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
McDonald’s Corporation presently has a consensus price target of $162.05, suggesting a potential upside of 1.40%. Noodles & has a consensus price target of $4.93, suggesting a potential upside of 23.21%. Given Noodles &’s higher probable upside, analysts clearly believe Noodles & is more favorable than McDonald’s Corporation.
McDonald’s Corporation beats Noodles & on 11 of the 16 factors compared between the two stocks.
About McDonald’s Corporation
McDonald’s Corporation (McDonald’s) operates and franchises McDonald’s restaurants. The Company’s restaurants serve a locally relevant menu of food and drinks sold at various price points in over 100 countries. The Company’s segments include U.S., International Lead Markets, High Growth Markets, and Foundational Markets and Corporate. The U.S. segment focuses on offering a platform for authentic ingredients that allows customers to customize their sandwiches. Its High Growth Markets segment includes its operations in markets, such as China, Italy, Korea, Poland, Russia, Spain, Switzerland, the Netherlands and related markets. The International Lead markets segment includes the Company’s operations in various markets, such as Australia, Canada, France, Germany, the United Kingdom and related markets. The Foundational markets and Corporate segment is engaged in operating restaurants and increasing convenience to customers, including through drive-thru and delivery.
About Noodles &
Noodles & Company develops and operates fast casual restaurants. The Company’s menu includes a range of cooked-to-order dishes, including noodles and pasta, soups, salads, sandwiches and appetizers. The Company has approximately 490 restaurants, including 420 Company-owned and 70 franchised locations, across 40 states, the District of Columbia and one Canadian province. The Company offers over 30 globally inspired Asian, Mediterranean and American dishes together on a single menu. The Company offers approximately 10 fresh vegetables and six proteins, including marinated steak, naturally raised pork, chicken, meatballs, shrimp and organic tofu. The Company offers Kids Meals, which includes sides, such as broccoli, carrots, fruit, applesauce and a portion of its housemade rice crispy treat. The Company’s restaurants’ locations include Arizona, California, Colorado, Delaware, New York, North Dakota, Ohio, Texas, Utah, Virginia, Washington and Wisconsin.
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