Shake Shack (NYSE:SHAK) and Simplicity Esports and Gaming (NASDAQ:WINR) are both small-cap retail/wholesale companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, earnings, risk, profitability, analyst recommendations, institutional ownership and dividends.

Profitability

This table compares Shake Shack and Simplicity Esports and Gaming’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Shake Shack 3.30% 9.57% 4.42%
Simplicity Esports and Gaming N/A -20.08% -7.00%

Risk and Volatility

Shake Shack has a beta of 1.44, meaning that its stock price is 44% more volatile than the S&P 500. Comparatively, Simplicity Esports and Gaming has a beta of 0.62, meaning that its stock price is 38% less volatile than the S&P 500.

Institutional and Insider Ownership

83.4% of Shake Shack shares are owned by institutional investors. Comparatively, 79.8% of Simplicity Esports and Gaming shares are owned by institutional investors. 30.2% of Shake Shack shares are owned by company insiders. Comparatively, 22.9% of Simplicity Esports and Gaming shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Shake Shack and Simplicity Esports and Gaming, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Shake Shack 1 6 3 0 2.20
Simplicity Esports and Gaming 0 0 0 0 N/A

Shake Shack presently has a consensus price target of $54.34, suggesting a potential downside of 0.78%. Given Shake Shack’s higher probable upside, equities analysts clearly believe Shake Shack is more favorable than Simplicity Esports and Gaming.

Valuation and Earnings

This table compares Shake Shack and Simplicity Esports and Gaming’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Shake Shack $445.59 million 4.56 $15.18 million $0.71 77.14
Simplicity Esports and Gaming N/A N/A -$10,000.00 N/A N/A

Shake Shack has higher revenue and earnings than Simplicity Esports and Gaming.

Summary

Shake Shack beats Simplicity Esports and Gaming on 10 of the 10 factors compared between the two stocks.

Shake Shack Company Profile

Shake Shack Inc. owns, operates, and licenses Shake Shack restaurants (Shacks) in the United States and internationally. Its Shacks offers hamburgers, hot dogs, chicken, crinkle cut fries, shakes, frozen custard, beer, wine, and other products. As of October 9, 2018, it operated 180 locations in 26 U.S. States and the District of Columbia, including approximately 70 locations across London, Hong Kong, Istanbul, Dubai, Tokyo, Moscow, Seoul, and internationally. Shake Shack Inc. was founded in 2004 and is headquartered in New York, New York.

Simplicity Esports and Gaming Company Profile

Simplicity Esports and Gaming Company operates as a virtual reality gaming and sports entertainment company in the United States and India. It owns and operates approximately 30 family entertainment centers across India, as well as a center in the United States. It offers an interactive and fun experience to customers at its centers, blending augmented reality and virtual reality and other games, indoor sports simulation entertainment, and food and beverage options to corporate customers, families, friends, and children. The company was formerly known as Smaaash Entertainment Inc. and changed its name to Simplicity Esports and Gaming Company in January 2019. Simplicity Esports and Gaming Company was incorporated in 2017 and is based in New York, New York.

Receive News & Ratings for Shake Shack Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Shake Shack and related companies with MarketBeat.com's FREE daily email newsletter.