Head to Head Contrast: Regis (NASDAQ:RGS) vs. Matthews International (NASDAQ:MATW)

Matthews International (NASDAQ:MATW) and Regis (NASDAQ:RGS) are both small-cap consumer discretionary companies, but which is the better stock? We will compare the two companies based on the strength of their risk, analyst recommendations, institutional ownership, valuation, dividends, earnings and profitability.

Analyst Ratings

This is a breakdown of recent ratings for Matthews International and Regis, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Matthews International	1	2	0	0	1.67
Regis	0	1	1	0	2.50

Matthews International presently has a consensus target price of $24.00, indicating a potential upside of 24.48%. Regis has a consensus target price of $42.00, indicating a potential upside of 42.25%. Given Regis’ stronger consensus rating and higher probable upside, analysts clearly believe Regis is more favorable than Matthews International.

Valuation & Earnings

This table compares Matthews International and Regis”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Matthews International	$1.11 billion	0.54	-$24.47 million	($0.93)	-20.73
Regis	$224.49 million	0.33	$6.94 million	$2.42	12.20

Regis has lower revenue, but higher earnings than Matthews International. Matthews International is trading at a lower price-to-earnings ratio than Regis, indicating that it is currently the more affordable of the two stocks.

Dividends

Matthews International pays an annual dividend of $1.02 per share and has a dividend yield of 5.3%. Regis pays an annual dividend of $0.24 per share and has a dividend yield of 0.8%. Matthews International pays out -109.7% of its earnings in the form of a dividend. Regis pays out 9.9% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Matthews International has increased its dividend for 30 consecutive years. Matthews International is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk and Volatility

Matthews International has a beta of 1.05, meaning that its stock price is 5% more volatile than the S&P 500. Comparatively, Regis has a beta of 1.25, meaning that its stock price is 25% more volatile than the S&P 500.

Profitability

This table compares Matthews International and Regis’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Matthews International	-2.65%	4.51%	1.45%
Regis	3.09%	4.10%	1.36%

Insider and Institutional Ownership

83.1% of Matthews International shares are owned by institutional investors. Comparatively, 31.5% of Regis shares are owned by institutional investors. 4.7% of Matthews International shares are owned by company insiders. Comparatively, 8.0% of Regis shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Summary

Regis beats Matthews International on 9 of the 17 factors compared between the two stocks.

About Matthews International

Matthews International Corporation provides brand solutions, memorialization products, and industrial technologies worldwide. It operates through three segments: Memorialization, Industrial Technologies, and SGK Brand Solutions. The Memorialization segment provides bronze and granite memorials, upright granite memorials and monuments, concrete burial vaults, cremation memorialization products, granite benches, flower vases, crypt plates and letters, cremation urns, niche units, cemetery features, and statues, as well as bronze plaques, letters, emblems, vases, lights and photo ceramics, granite monuments, mausoleums, crypts, and flush memorials. The Industrial Technologies segment designs, manufactures, services, and distributes high-tech custom energy storage solutions, and product identification and warehouse automation technologies and solutions, including order fulfillment systems for identifying, tracking, picking, and conveying consumer and industrial products. This segment also provides engineered calendaring, laminating, and coating equipment; stand-alone marking products; laser and ink-jet printing systems; and spare parts, calendar, and coating-roller refurbishing and retrofits. The SGK Brand solutions segment provides brand management, pre-media services, printing plates and cylinders, imaging services, digital asset management, merchandising display systems, and marketing and design services for the consumer goods and retail industries. The company was founded in 1850 and is based in Pittsburgh, Pennsylvania.

About Regis

Regis Corporation owns, operates, and franchises hairstyling and hair care salons in the United States, the United Kingdom, Canada, and Puerto Rico. The company operates in two segments, Franchise Salons and Company-owned Salons. Its salons provide haircutting and styling, including shampooing and conditioning; hair coloring; and other services, as well as sells various hair care and other beauty products. The company also offers OpenSalon Pro, a back-office salon management system; and Opensalon mobile application. Regis Corporation operates its salons primarily under the SmartStyle, Supercuts, Cost Cutters, Roosters, and First Choice Haircutters names. As of June 30, 2021, the company operated 5,917 salons, such as 5,563 franchised salons, 276 company-owned salons, and 78 non-controlling ownership salons. It also operates accredited cosmetology schools. The company was founded in 1922 and is headquartered in Minneapolis, Minnesota.