Analyzing Texas Roadhouse (NASDAQ:TXRH) and GEN Restaurant Group (NASDAQ:GENK)

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

Analyst Recommendations

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

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

Texas Roadhouse currently has a consensus price target of $193.36, indicating a potential upside of 13.05%. GEN Restaurant Group has a consensus price target of $11.63, indicating a potential upside of 108.33%. Given GEN Restaurant Group’s stronger consensus rating and higher probable upside, analysts clearly believe GEN Restaurant Group is more favorable than Texas Roadhouse.

Valuation & Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Texas Roadhouse	$5.37 billion	2.12	$304.88 million	$6.47	26.44
GEN Restaurant Group	$208.38 million	0.89	$8.41 million	$0.14	39.86

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.

Insider and Institutional Ownership

94.8% of Texas Roadhouse shares are owned by institutional investors. Comparatively, 10.2% of GEN Restaurant Group shares are owned by institutional investors. 0.5% of Texas Roadhouse shares are owned by company insiders. Comparatively, 61.1% of GEN Restaurant Group shares are owned 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 Texas Roadhouse and GEN Restaurant Group’s net margins, return on equity and return on assets.

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

Volatility and Risk

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

Summary

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