Head to Head Contrast: BT Brands (NASDAQ:BTBD) & ONE Group Hospitality (NASDAQ:STKS)

BT Brands (NASDAQ:BTBD) and ONE Group Hospitality (NASDAQ:STKS) are both small-cap consumer discretionary companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, dividends, earnings, risk, analyst recommendations, valuation and profitability.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for BT Brands and ONE Group Hospitality, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
BT Brands	1	0	0	0	1.00
ONE Group Hospitality	1	2	1	0	2.00

ONE Group Hospitality has a consensus target price of $4.00, suggesting a potential upside of 238.98%. Given ONE Group Hospitality’s stronger consensus rating and higher probable upside, analysts clearly believe ONE Group Hospitality is more favorable than BT Brands.

Profitability

This table compares BT Brands and ONE Group Hospitality’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
BT Brands	-4.57%	-8.99%	-5.45%
ONE Group Hospitality	-2.68%	-10.49%	-0.91%

Institutional and Insider Ownership

0.4% of BT Brands shares are owned by institutional investors. Comparatively, 29.1% of ONE Group Hospitality shares are owned by institutional investors. 19.6% of BT Brands shares are owned by insiders. Comparatively, 25.7% of ONE Group Hospitality shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Volatility & Risk

BT Brands has a beta of 0.52, meaning that its stock price is 48% less volatile than the S&P 500. Comparatively, ONE Group Hospitality has a beta of 1.3, meaning that its stock price is 30% more volatile than the S&P 500.

Valuation and Earnings

This table compares BT Brands and ONE Group Hospitality”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
BT Brands	$13.49 million	0.72	-$690,000.00	($0.09)	-17.51
ONE Group Hospitality	$805.72 million	0.05	-$92.24 million	($1.84)	-0.64

BT Brands has higher earnings, but lower revenue than ONE Group Hospitality. BT Brands is trading at a lower price-to-earnings ratio than ONE Group Hospitality, indicating that it is currently the more affordable of the two stocks.

Summary

ONE Group Hospitality beats BT Brands on 10 of the 14 factors compared between the two stocks.

About BT Brands

BT Brands, Inc. owns and operates fast-food restaurants in the north central region of United States. The company operates Burger Time restaurants located in Minnesota, North Dakota, and South Dakota; and a Dairy Queen franchise in Ham Lake, Minnesota. Its Burger Time restaurants provide various burgers and other food products, such as chicken sandwiches, pulled pork sandwiches, chicken chunks, side dishes, and soft drinks; and Dairy Queen restaurant offers burgers, chicken, sides, ice cream and other desserts, and various beverages. The company was founded in 1987 and is based in West Fargo, North Dakota.

About ONE Group Hospitality

The ONE Group Hospitality, Inc., a restaurant company, develops, owns, operates, manages, and licenses restaurants and lounges worldwide. It operates through STK, Kona Grill, and ONE Hospitality segments. The company also provides turn-key food and beverage services for hospitality venues, including hotels, casinos, and other locations. Its hospitality food and beverage solutions include developing, managing, and operating restaurants, bars, rooftops, pools, banqueting, catering, private dining rooms, room service, and mini bars; and offers hospitality advisory and consulting services. The company operates restaurants primarily under the STK and Kona Grill brands. The ONE Group Hospitality, Inc. was founded in 2004 and is based in Denver, Colorado.