Chipotle Mexican Grill (NYSE: CMG) and Jack in the Box (NASDAQ:JACK) are both mid-cap cyclical consumer goods & services companies, but which is the superior business? We will contrast the two companies based on the strength of their analyst recommendations, valuation, earnings, profitability, institutional ownership, risk and dividends.

Profitability

This table compares Chipotle Mexican Grill and Jack in the Box’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Chipotle Mexican Grill 3.37% 11.80% 8.11%
Jack in the Box 8.71% -30.55% 9.64%

Risk & Volatility

Chipotle Mexican Grill has a beta of 0.49, indicating that its stock price is 51% less volatile than the S&P 500. Comparatively, Jack in the Box has a beta of 0.51, indicating that its stock price is 49% less volatile than the S&P 500.

Institutional and Insider Ownership

88.7% of Chipotle Mexican Grill shares are held by institutional investors. Comparatively, 99.3% of Jack in the Box shares are held by institutional investors. 2.0% of Chipotle Mexican Grill shares are held by company insiders. Comparatively, 2.1% of Jack in the Box shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Chipotle Mexican Grill and Jack in the Box, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Chipotle Mexican Grill 5 22 8 0 2.09
Jack in the Box 0 4 9 0 2.69

Chipotle Mexican Grill presently has a consensus price target of $350.40, suggesting a potential upside of 13.92%. Jack in the Box has a consensus price target of $113.25, suggesting a potential upside of 7.65%. Given Chipotle Mexican Grill’s higher possible upside, analysts plainly believe Chipotle Mexican Grill is more favorable than Jack in the Box.

Earnings and Valuation

This table compares Chipotle Mexican Grill and Jack in the Box’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Chipotle Mexican Grill $3.90 billion 2.22 $22.93 million $5.16 59.61
Jack in the Box $1.55 billion 1.99 $135.33 million $4.40 23.91

Jack in the Box has lower revenue, but higher earnings than Chipotle Mexican Grill. Jack in the Box 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.

Dividends

Jack in the Box pays an annual dividend of $1.60 per share and has a dividend yield of 1.5%. Chipotle Mexican Grill does not pay a dividend. Jack in the Box pays out 36.4% of its earnings in the form of a dividend.

Summary

Jack in the Box beats Chipotle Mexican Grill on 9 of the 16 factors compared between the two stocks.

About Chipotle Mexican Grill

Chipotle Mexican Grill, Inc. (Chipotle), together with its subsidiaries, operates Chipotle Mexican Grill restaurants. The Company’s Chipotle Mexican Grill restaurants serve a menu of burritos, tacos, burrito bowls (a burrito without the tortilla) and salads. As of December 31, 2016, the Company managed its operations and restaurants based on 11 regions. As of December 31, 2016, the Company operated 2,198 Chipotle restaurants throughout the United States, as well as 29 international Chipotle restaurants, and it also had 23 restaurants in operation in other non-Chipotle concepts. As of December 31, 2016, 29 of its restaurants were located outside of the United States, with 17 in Canada, six in the United Kingdom, five in France and one in Frankfurt, Germany. The Company sells gift cards, which do not have an expiration date. The Company categorizes its restaurants as end-caps (at the end of a line of retail outlets), in-lines (in a line of retail outlets), free-standing or other.

About Jack in the Box

Jack in the Box Inc. operates and franchises Jack in the Box quick-service restaurants (QSRs) and Qdoba Mexican Eats (Qdoba) fast-casual restaurants. The Company operates in two segments: Jack in the Box and Qdoba restaurant operations. Qdoba is a fast-casual Mexican food brand in the United States, offering food items including burritos, tacos, salads, and quesadillas. Jack in the Box is a hamburger chain, which offers a selection of products, including classic burgers such as, Jumbo Jack burgers, and new product lines, such as Buttery Jack burgers, and its Brunchfast menu. As of October 2, 2016, the Company operated 2,954 Jack in the Box QSRs and Qdoba fast-casual restaurants. As of October 2, 2016, Jack in the Box system included 2,255restaurants, of which 417 were company-operated and 1,838 were franchise operated. As of October 2, 2016, the Qdoba system included 699 restaurants, of which 367 were company operated and 332 were franchise operated.

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