FAT Brands (NASDAQ:FAT – Get Free Report) and Domino’s Pizza (NASDAQ:DPZ – Get Free Report) are both retail/wholesale companies, but which is the superior business? We will compare the two businesses based on the strength of their risk, valuation, profitability, analyst recommendations, earnings, institutional ownership and dividends.
Earnings and Valuation
This table compares FAT Brands and Domino’s Pizza”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| FAT Brands | $574.14 million | 0.01 | -$189.85 million | ($13.35) | -0.01 |
| Domino’s Pizza | $4.94 billion | 2.04 | $601.70 million | $17.37 | 17.40 |
Dividends
FAT Brands pays an annual dividend of $0.14 per share and has a dividend yield of 86.1%. Domino’s Pizza pays an annual dividend of $7.96 per share and has a dividend yield of 2.6%. FAT Brands pays out -1.0% of its earnings in the form of a dividend. Domino’s Pizza pays out 45.8% 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. Domino’s Pizza has increased its dividend for 12 consecutive years. FAT Brands is clearly the better dividend stock, given its higher yield and lower payout ratio.
Analyst Ratings
This is a summary of recent ratings and recommmendations for FAT Brands and Domino’s Pizza, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| FAT Brands | 1 | 2 | 0 | 0 | 1.67 |
| Domino’s Pizza | 2 | 12 | 17 | 0 | 2.48 |
Domino’s Pizza has a consensus price target of $419.74, suggesting a potential upside of 38.85%. Given Domino’s Pizza’s stronger consensus rating and higher probable upside, analysts clearly believe Domino’s Pizza is more favorable than FAT Brands.
Risk & Volatility
FAT Brands has a beta of 1.34, suggesting that its share price is 34% more volatile than the S&P 500. Comparatively, Domino’s Pizza has a beta of 1.02, suggesting that its share price is 2% more volatile than the S&P 500.
Institutional & Insider Ownership
6.9% of FAT Brands shares are held by institutional investors. Comparatively, 94.6% of Domino’s Pizza shares are held by institutional investors. 15.7% of FAT Brands shares are held by company insiders. Comparatively, 0.9% of Domino’s Pizza shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
Profitability
This table compares FAT Brands and Domino’s Pizza’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| FAT Brands | -39.33% | N/A | -17.99% |
| Domino’s Pizza | 11.89% | -15.04% | 33.66% |
Summary
Domino’s Pizza beats FAT Brands on 12 of the 17 factors compared between the two stocks.
About FAT Brands
FAT Brands Inc., a multi-brand restaurant franchising company, acquires, develops, markets, and manages quick service, fast casual, casual dining, and polished casual dining restaurant concepts worldwide. It owns restaurant brands, including Round Table Pizza, Marble Slab Creamery, Great American Cookies, Hot Dog on a Stick, Pretzelmaker, Fazoli's, Fatburger, Johnny Rockets, Elevation Burger, Yalla Mediterranean, Buffalo's Cafe and Buffalo's Express, Hurricane Grill & Wings, Ponderosa Steakhouse/Bonanza Steakhouse, Native Grill & Wings, Smokey Bones, and Twin Peaks. The company was incorporated in 2017 and is headquartered in Beverly Hills, California. FAT Brands Inc. is a subsidiary of Fog Cutter Holdings, LLC.
About Domino’s Pizza
Domino’s Pizza, Inc., through its subsidiaries, operates as a pizza company in the United States and internationally. The company operates through three segments: U.S. Stores, International Franchise, and Supply Chain. It offers pizzas under the Domino’s brand name through company-owned and franchised stores. It also provides oven-baked sandwiches, pastas, boneless chicken and chicken wings, breads and dips, desserts, and soft drink products, as well as loaded tots and pepperoni stuffed cheesy breads. Domino’s Pizza, Inc. was founded in 1960 and is headquartered in Ann Arbor, Michigan.
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