Cracker Barrel Old Country Store (NASDAQ:CBRL) and Aramark (NYSE:ARMK) are both mid-cap retail/wholesale companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, valuation, dividends, profitability, analyst recommendations, institutional ownership and risk.
This table compares Cracker Barrel Old Country Store and Aramark’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Cracker Barrel Old Country Store||7.09%||34.20%||13.43%|
This is a breakdown of current ratings and price targets for Cracker Barrel Old Country Store and Aramark, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Cracker Barrel Old Country Store||2||3||2||0||2.00|
Cracker Barrel Old Country Store currently has a consensus target price of $162.54, indicating a potential upside of 4.50%. Aramark has a consensus target price of $42.27, indicating a potential upside of 41.52%. Given Aramark’s stronger consensus rating and higher possible upside, analysts clearly believe Aramark is more favorable than Cracker Barrel Old Country Store.
Cracker Barrel Old Country Store pays an annual dividend of $5.00 per share and has a dividend yield of 3.2%. Aramark pays an annual dividend of $0.44 per share and has a dividend yield of 1.5%. Cracker Barrel Old Country Store pays out 56.4% of its earnings in the form of a dividend. Aramark pays out 22.1% 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. Cracker Barrel Old Country Store has raised its dividend for 9 consecutive years and Aramark has raised its dividend for 4 consecutive years. Cracker Barrel Old Country Store is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Valuation & Earnings
This table compares Cracker Barrel Old Country Store and Aramark’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Cracker Barrel Old Country Store||$3.03 billion||1.23||$247.62 million||$8.87||17.53|
|Aramark||$15.79 billion||0.47||$567.88 million||$1.99||15.01|
Aramark has higher revenue and earnings than Cracker Barrel Old Country Store. Aramark is trading at a lower price-to-earnings ratio than Cracker Barrel Old Country Store, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Cracker Barrel Old Country Store has a beta of 0.49, indicating that its stock price is 51% less volatile than the S&P 500. Comparatively, Aramark has a beta of 1.1, indicating that its stock price is 10% more volatile than the S&P 500.
Insider and Institutional Ownership
83.9% of Cracker Barrel Old Country Store shares are owned by institutional investors. 0.9% of Cracker Barrel Old Country Store shares are owned by insiders. Comparatively, 3.5% of Aramark shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Cracker Barrel Old Country Store beats Aramark on 9 of the 17 factors compared between the two stocks.
Cracker Barrel Old Country Store Company Profile
Cracker Barrel Old Country Store, Inc. develops and operates the Cracker Barrel Old Country Store concept in the United States. Its Cracker Barrel stores consist of a restaurant with a gift shop. The company's restaurants serve breakfast, lunch, and dinner. Its gift shops offer various decorative and functional items, such as rocking chairs, holiday and seasonal gifts, toys, apparel, music CDs, cookware, and various other gift items, as well as pies, cornbread mixes, coffee, syrups, pancake mixes, candies, preserves, and other food items. As of September 20, 2018, the company operated 655 Cracker Barrel Old Country stores in 45 states. Cracker Barrel Old Country Store, Inc. was founded in 1969 and is headquartered in Lebanon, Tennessee.
Aramark Company Profile
Aramark provides food, facilities management, and uniform services to education, healthcare, business and industry, sports, leisure, and corrections clients in North America and internationally. It operates in three segments: Food and Support Services United States, Food and Support Services International, and Uniform and Career Apparel. The company offers managed services, including dining, catering, food service management, and convenience-oriented retail operations; non-clinical support services, such as patient food and nutrition, retail food, and procurement services; and plant operations and maintenance, custodial/housekeeping, energy management, clinical equipment maintenance, grounds keeping, and capital project management services. It also provides on-site restaurants, convenience stores, and executive dining services; beverage and vending services; and facility management services comprising landscaping, transportation, payment, and other facility consulting services relating to building operations. In addition, the company offers concessions, banquet, and catering services; retail services and merchandise sale, recreational, and lodging services; and facility management services at sports, entertainment, and recreational facilities. Additionally, the company offers correctional food, and food and facilities management services for parks; and operates commissaries, laundry facilities, and property rooms. It also provides design, sourcing and manufacturing, delivery, cleaning, maintenance, and marketing services for uniforms and accessories; provides managed restroom services; and rents uniforms, work clothing, outerwear, particulate-free garments, and non-garment items and related services that include mats, shop towels, and first aid supplies. The company was formerly known as ARAMARK Holdings Corporation and changed its name to Aramark in May 2014. Aramark was founded in 1959 and is based in Philadelphia, Pennsylvania.
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