RCI Hospitality (NASDAQ:RICK – Get Free Report) and Rave Restaurant Group (NASDAQ:RAVE – Get Free Report) are both small-cap consumer discretionary companies, but which is the better business? We will compare the two companies based on the strength of their valuation, institutional ownership, analyst recommendations, dividends, earnings, profitability and risk.
Valuation & Earnings
This table compares RCI Hospitality and Rave Restaurant Group”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| RCI Hospitality | $279.43 million | 0.78 | $10.81 million | ($0.41) | -69.59 |
| Rave Restaurant Group | $12.63 million | 3.34 | $2.70 million | $0.21 | 14.14 |
Profitability
This table compares RCI Hospitality and Rave Restaurant Group’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| RCI Hospitality | -1.48% | -1.74% | -0.72% |
| Rave Restaurant Group | 23.19% | 19.22% | 16.81% |
Insider & Institutional Ownership
53.8% of RCI Hospitality shares are held by institutional investors. Comparatively, 15.1% of Rave Restaurant Group shares are held by institutional investors. 11.4% of RCI Hospitality shares are held by company insiders. Comparatively, 28.0% of Rave Restaurant Group shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Volatility & Risk
RCI Hospitality has a beta of 0.78, indicating that its share price is 22% less volatile than the S&P 500. Comparatively, Rave Restaurant Group has a beta of 0.43, indicating that its share price is 57% less volatile than the S&P 500.
Analyst Recommendations
This is a summary of current ratings and target prices for RCI Hospitality and Rave Restaurant Group, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| RCI Hospitality | 1 | 0 | 0 | 0 | 1.00 |
| Rave Restaurant Group | 0 | 1 | 0 | 0 | 2.00 |
Summary
Rave Restaurant Group beats RCI Hospitality on 8 of the 12 factors compared between the two stocks.
About RCI Hospitality
RCI Hospitality Holdings, Inc., through its subsidiaries, engages in the hospitality and related businesses in the United States. It operates in Nightclubs, Bombshells, and Media Group segments. The company’s wholly-owned subsidiaries own and/or operates upscale adult nightclubs serving primarily businessmen and professionals under the Rick's Cabaret, Jaguars Club, Tootsie's Cabaret, XTC Cabaret, Club Onyx, Hoops Cabaret and Sports Bar, Scarlett's Cabaret, Temptations Adult Cabaret, Foxy's Cabaret, Vivid Cabaret, Downtown Cabaret, Cabaret East, The Seville, Silver City Cabaret, and Kappa Men's Club. Wholly-owned subsidiaries also operate restaurants and sports bars under the Bombshells Restaurant & Bar brand; and dance clubs under the Studio 80 brand. As of February 11, 2019, the company operated 46 units, including 39 nightclub units and 7 Bombshell units. In addition, it owns two national industry trade publications serving the adult nightclubs industry and the adult retail products industry; a national industry convention and tradeshow; and two national industry award shows, as well as approximately a dozen industry and social media Websites. The company founded in 1983 as Rick's Cabaret International, Inc., changed its name to RCI Hospitality Holdings, Inc. in August 2014, and is based in Houston, Texas.
About Rave Restaurant Group
Rave Restaurant Group, Inc., together with its subsidiaries, engages in the operation and franchising of pizza buffet, delivery/carry-out (delco), and express restaurants under the Pizza Inn and Pie Five trademarks in the United States and internationally. The company operates through three segments: Pizza Inn Franchising, Pie Five Franchising, and Company-Owned Restaurants. Its buffet restaurants are located in free standing buildings or strip centers in retail developments that offer dine-in, carryout, and catering services, as well as delivery services. The company’s delco restaurants provide delivery and carryout services and are located in shopping centers or other in-line retail developments. Its Express restaurants serve customers through various non-traditional points of sale and are located in convenience stores, food courts, college campuses, airport terminals, travel plazas, athletic facilities, or other commercial facilities. The company’s Pizza Inn Express restaurants serve customers through a non-traditional, licensed, pizza-only model called Pizza Inn Express, located at production-oriented facilities. In addition, it operates and franchises fast casual restaurants under the Pie Five Pizza Company or Pie Five trademarks. The company was formerly known as Pizza Inn Holdings, Inc. and changed its name to Rave Restaurant Group, Inc. in January 2015. Rave Restaurant Group, Inc. was founded in 1958 and is based in The Colony, Texas.
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