H.I.S. (OTCMKTS:HISJF) & RCI Hospitality (NASDAQ:RICK) Critical Comparison

H.I.S. (OTCMKTS:HISJF) and RCI Hospitality (NASDAQ:RICK) are both small-cap consumer discretionary companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, analyst recommendations, dividends, risk, valuation, earnings and institutional ownership.

Volatility and Risk

H.I.S. has a beta of -0.07, suggesting that its share price is 107% less volatile than the S&P 500. Comparatively, RCI Hospitality has a beta of 1.17, suggesting that its share price is 17% more volatile than the S&P 500.

Profitability

This table compares H.I.S. and RCI Hospitality’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
H.I.S.	N/A	N/A	N/A
RCI Hospitality	5.88%	6.19%	2.81%

Analyst Recommendations

This is a summary of current recommendations and price targets for H.I.S. and RCI Hospitality, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
H.I.S.	0	0	0	0	0.00
RCI Hospitality	1	0	1	0	2.00

RCI Hospitality has a consensus price target of $98.00, indicating a potential upside of 268.84%. Given RCI Hospitality’s stronger consensus rating and higher probable upside, analysts clearly believe RCI Hospitality is more favorable than H.I.S..

Insider and Institutional Ownership

53.8% of RCI Hospitality shares are owned by institutional investors. 9.6% of RCI Hospitality 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.

Earnings & Valuation

This table compares H.I.S. and RCI Hospitality”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
H.I.S.	$2.30 billion	0.43	$58.40 million	$0.61	21.46
RCI Hospitality	$295.60 million	0.78	$3.01 million	$1.86	14.28

H.I.S. has higher revenue and earnings than RCI Hospitality. RCI Hospitality is trading at a lower price-to-earnings ratio than H.I.S., indicating that it is currently the more affordable of the two stocks.

Summary

RCI Hospitality beats H.I.S. on 11 of the 14 factors compared between the two stocks.

About H.I.S.

H.I.S. Co., Ltd. provides travel agency services worldwide. The company offers sports related tours, such as ski and diving tours; casual to luxury cruises; escort accompanied tours, honeymoons, and onboard weddings; and local tour services in Australia, Thailand, Bali Island, Guam, and South Korea. It also operates hotels and theme parks; an online platform for various travel services; and bus tours connecting Tokyo and the surrounding area to Kansai and Nagoya. In addition, the company offers advertising services; and domestic and overseas travel insurance products. Further, it operates Hapi-robo st, a robot; offers various types of construction works; provides hotel amenities, guest room facilities, and furniture and electronic appliances for offices and houses; sets and manages events; coordinates with Japan medical tourism; and offers direct sales support services. Additionally, the company provides a range of diploma and certificate programs in business, international trade, hospitality, information technology, and health care; and communication equipment and services. Furthermore, it operates Smrt English, an English learning platform; and GREEN OCEAN, a job placement agency that focus on agriculture and accommodation business. The company was formerly known as International Tours Co., Ltd. and changed its name to H.I.S. Co., Ltd. in 1990. H.I.S. Co., Ltd. was incorporated in 1980 and is headquartered in Tokyo, Japan.

About RCI Hospitality

RCI Hospitality Holdings, Inc., through its subsidiaries, engages in the hospitality and related businesses in the United States. It operates in Nightclubs, Bombshells, and Media Group segments. The company’s wholly-owned subsidiaries own and/or operates upscale adult nightclubs serving primarily businessmen and professionals under the Rick's Cabaret, Jaguars Club, Tootsie's Cabaret, XTC Cabaret, Club Onyx, Hoops Cabaret and Sports Bar, Scarlett's Cabaret, Temptations Adult Cabaret, Foxy's Cabaret, Vivid Cabaret, Downtown Cabaret, Cabaret East, The Seville, Silver City Cabaret, and Kappa Men's Club. Wholly-owned subsidiaries also operate restaurants and sports bars under the Bombshells Restaurant & Bar brand; and dance clubs under the Studio 80 brand. As of February 11, 2019, the company operated 46 units, including 39 nightclub units and 7 Bombshell units. In addition, it owns two national industry trade publications serving the adult nightclubs industry and the adult retail products industry; a national industry convention and tradeshow; and two national industry award shows, as well as approximately a dozen industry and social media Websites. The company founded in 1983 as Rick's Cabaret International, Inc., changed its name to RCI Hospitality Holdings, Inc. in August 2014, and is based in Houston, Texas.