Dutch Bros (NYSE:BROS) versus Texas Roadhouse (NASDAQ:TXRH) Critical Comparison

Texas Roadhouse (NASDAQ:TXRH) and Dutch Bros (NYSE:BROS) are both retail/wholesale companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, dividends, risk, institutional ownership, valuation, analyst recommendations and earnings.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Texas Roadhouse and Dutch Bros, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Texas Roadhouse	0	13	11	1	2.52
Dutch Bros	0	3	20	1	2.92

Texas Roadhouse presently has a consensus target price of $195.90, indicating a potential upside of 20.88%. Dutch Bros has a consensus target price of $75.95, indicating a potential upside of 50.18%. Given Dutch Bros’ stronger consensus rating and higher probable upside, analysts clearly believe Dutch Bros is more favorable than Texas Roadhouse.

Volatility & Risk

Texas Roadhouse has a beta of 0.88, indicating that its share price is 12% less volatile than the S&P 500. Comparatively, Dutch Bros has a beta of 2.49, indicating that its share price is 149% more volatile than the S&P 500.

Insider & Institutional Ownership

94.8% of Texas Roadhouse shares are owned by institutional investors. Comparatively, 85.5% of Dutch Bros shares are owned by institutional investors. 0.5% of Texas Roadhouse shares are owned by insiders. Comparatively, 42.4% of Dutch Bros shares are owned by 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 Texas Roadhouse and Dutch Bros’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Texas Roadhouse	6.90%	27.88%	12.23%
Dutch Bros	4.87%	9.56%	2.82%

Earnings and Valuation

This table compares Texas Roadhouse and Dutch Bros”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Texas Roadhouse	$5.88 billion	1.82	$405.55 million	$6.09	26.61
Dutch Bros	$1.64 billion	5.08	$79.84 million	$0.64	79.03

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

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.

About Dutch Bros

Dutch Bros Inc., together with its subsidiaries, operates and franchises drive-thru shops in the United States. The company operates through Company-Operated Shops and Franchising and Other segments. It serves through company-operated shops and online channels under Dutch Bros; Dutch Bros Coffee; Dutch Bros Rebel; Dutch Bros; and Blue Rebel brands. Dutch Bros Inc. was founded in 1992 and is headquartered in Grants Pass, Oregon.