Dunkin’ Brands (DNKN) vs. Greene King (GKNGY) Financial Analysis

Dunkin’ Brands (NASDAQ: DNKN) and Greene King (OTCMKTS:GKNGY) are both retail/wholesale companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, earnings, profitability, valuation, risk, analyst recommendations and institutional ownership.

Earnings & Valuation

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This table compares Dunkin’ Brands and Greene King’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Dunkin’ Brands $860.50 million 5.74 $350.90 million $2.43 24.56
Greene King $2.87 billion 0.67 $196.23 million $1.83 6.78

Dunkin’ Brands has higher earnings, but lower revenue than Greene King. Greene King is trading at a lower price-to-earnings ratio than Dunkin’ Brands, indicating that it is currently the more affordable of the two stocks.

Dividends

Dunkin’ Brands pays an annual dividend of $1.39 per share and has a dividend yield of 2.3%. Greene King pays an annual dividend of $0.87 per share and has a dividend yield of 7.0%. Dunkin’ Brands pays out 57.2% of its earnings in the form of a dividend. Greene King pays out 47.5% 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. Greene King is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares Dunkin’ Brands and Greene King’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Dunkin’ Brands 40.77% -190.44% 6.67%
Greene King N/A N/A N/A

Insider and Institutional Ownership

97.7% of Dunkin’ Brands shares are owned by institutional investors. 3.1% of Dunkin’ Brands shares are owned by 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 Ratings

This is a summary of recent ratings and recommmendations for Dunkin’ Brands and Greene King, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Dunkin’ Brands 1 8 10 0 2.47
Greene King 0 0 0 0 N/A

Dunkin’ Brands currently has a consensus price target of $63.68, indicating a potential upside of 6.69%. Given Dunkin’ Brands’ higher possible upside, research analysts plainly believe Dunkin’ Brands is more favorable than Greene King.

Risk & Volatility

Dunkin’ Brands has a beta of 0.3, meaning that its share price is 70% less volatile than the S&P 500. Comparatively, Greene King has a beta of 0.3, meaning that its share price is 70% less volatile than the S&P 500.

Summary

Dunkin’ Brands beats Greene King on 10 of the 14 factors compared between the two stocks.

About Dunkin’ Brands

Dunkin' Brands Group, Inc., together with its subsidiaries, develops, franchises, and licenses quick service restaurants worldwide. The company operates through four segments: Dunkin' Donuts U.S., Dunkin' Donuts International, Baskin-Robbins International, and Baskin-Robbins U.S. Its restaurants offer hot and cold coffee, baked goods, donuts, bagels, muffins, breakfast sandwiches, hard and soft serve ice creams, frozen yogurts, shakes, malts, floats, and cakes. As of December 30, 2017, the company had 12,538 Dunkin' Donuts points of distribution and 7,982 Baskin-Robbins points of distribution. It franchises restaurants under the Dunkin' Donuts and Baskin-Robbins brands. The company is headquartered in Canton, Massachusetts.

About Greene King

Greene King plc operates as a pub retailer and brewer in the United Kingdom. The company operates through Pub Company, Pub Partners, and Brewing & Brands segments. Its retail brands and formats include Greene King Local Pubs, Hungry Horse, Flaming Grill, Farmhouse Inns, and Chef & Brewer. The company is also involved in brewing, marketing, and selling beer under the Greene King IPA, Old Speckled Hen, Abbot Ale, and Belhaven Best brands. In addition, Greene King plc engages in the employment, financing, pension trustee, and property businesses. It operates 2,924 pubs, restaurants, and hotels across England, Wales, and Scotland, including 1,769 retail pubs, restaurants, and hotels, and 1,155 tenanted, leased, and franchised pubs. Greene King plc was founded in 1799 and is headquartered in Bury St Edmunds, the United Kingdom.

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