Texas Roadhouse (NASDAQ:TXRH) versus GEN Restaurant Group (NASDAQ:GENK) Head-To-Head Analysis

GEN Restaurant Group (NASDAQ:GENK) and Texas Roadhouse (NASDAQ:TXRH) are both retail/wholesale companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, risk, institutional ownership, earnings, analyst recommendations, valuation and dividends.

Risk & Volatility

GEN Restaurant Group has a beta of 1.89, meaning that its stock price is 89% more volatile than the S&P 500. Comparatively, Texas Roadhouse has a beta of 1, meaning that its stock price has a similar volatility profile to the S&P 500.

Earnings & Valuation

This table compares GEN Restaurant Group and Texas Roadhouse”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
GEN Restaurant Group	$208.38 million	0.71	$8.41 million	$0.14	31.86
Texas Roadhouse	$5.37 billion	1.98	$304.88 million	$6.47	24.71

Texas Roadhouse has higher revenue and earnings than GEN Restaurant Group. Texas Roadhouse is trading at a lower price-to-earnings ratio than GEN Restaurant Group, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

10.2% of GEN Restaurant Group shares are held by institutional investors. Comparatively, 94.8% of Texas Roadhouse shares are held by institutional investors. 61.1% of GEN Restaurant Group shares are held by company insiders. Comparatively, 0.5% of Texas Roadhouse shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of current ratings for GEN Restaurant Group and Texas Roadhouse, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
GEN Restaurant Group	0	0	3	0	3.00
Texas Roadhouse	0	11	12	0	2.52

GEN Restaurant Group presently has a consensus price target of $11.63, indicating a potential upside of 160.65%. Texas Roadhouse has a consensus price target of $193.36, indicating a potential upside of 20.96%. Given GEN Restaurant Group’s stronger consensus rating and higher possible upside, equities research analysts clearly believe GEN Restaurant Group is more favorable than Texas Roadhouse.

Profitability

This table compares GEN Restaurant Group and Texas Roadhouse’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
GEN Restaurant Group	0.39%	1.83%	0.37%
Texas Roadhouse	8.07%	34.02%	15.11%

Summary

Texas Roadhouse beats GEN Restaurant Group on 9 of the 14 factors compared between the two stocks.

About GEN Restaurant Group

GEN Restaurant Group, Inc. operates restaurants in California, Arizona, Hawaii, Nevada, Texas, New York, and Florida. It offers meats, poultry, and seafood. The company was founded in 2011 and is based in Cerritos, California.

About Texas Roadhouse

Texas Roadhouse, Inc., together with its subsidiaries, operates casual dining restaurants in the United States and internationally. It also operates and franchises restaurants under the Texas Roadhouse, Bubba's 33, and Jaggers names in 49 states and ten internationally. Texas Roadhouse, Inc. was founded in 1993 and is based in Louisville, Kentucky.