Head-To-Head Comparison: Darden Restaurants (NYSE:DRI) versus Granite City Food & Brewery (NYSE:GCFB)

Granite City Food & Brewery (OTCMKTS:GCFB) and Darden Restaurants (NYSE:DRI) are both retail/wholesale companies, but which is the superior business? We will compare the two businesses based on the strength of their risk, profitability, dividends, institutional ownership, valuation, analyst recommendations and earnings.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Granite City Food & Brewery and Darden Restaurants, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Granite City Food & Brewery 0 0 0 0 N/A
Darden Restaurants 1 7 17 0 2.64

Darden Restaurants has a consensus target price of $130.61, suggesting a potential upside of 7.30%. Given Darden Restaurants’ higher probable upside, analysts clearly believe Darden Restaurants is more favorable than Granite City Food & Brewery.

Earnings & Valuation

This table compares Granite City Food & Brewery and Darden Restaurants’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Granite City Food & Brewery $133.84 million N/A -$7.37 million N/A N/A
Darden Restaurants $8.51 billion 1.76 $713.40 million $5.82 20.92

Darden Restaurants has higher revenue and earnings than Granite City Food & Brewery.

Profitability

This table compares Granite City Food & Brewery and Darden Restaurants’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Granite City Food & Brewery N/A N/A N/A
Darden Restaurants 8.38% 31.61% 12.89%

Dividends

Darden Restaurants pays an annual dividend of $3.00 per share and has a dividend yield of 2.5%. Granite City Food & Brewery does not pay a dividend. Darden Restaurants pays out 51.5% of its earnings in the form of a dividend. Darden Restaurants has raised its dividend for 2 consecutive years.

Institutional and Insider Ownership

88.8% of Darden Restaurants shares are owned by institutional investors. 26.3% of Granite City Food & Brewery shares are owned by company insiders. Comparatively, 0.7% of Darden Restaurants shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Volatility and Risk

Granite City Food & Brewery has a beta of -4, meaning that its share price is 500% less volatile than the S&P 500. Comparatively, Darden Restaurants has a beta of 0.3, meaning that its share price is 70% less volatile than the S&P 500.

Summary

Darden Restaurants beats Granite City Food & Brewery on 11 of the 13 factors compared between the two stocks.

About Granite City Food & Brewery

Granite City Food & Brewery, Ltd. operates casual dining restaurants in the United States. The company's upscale casual dining restaurants include the Granite City Food & Brewery restaurant that offers various menu items and handcrafted beers, as well as other regional craft beers; and the Cadillac Ranch All American Bar & Grill restaurant that offers American cuisine, including homemade meatloaf and pasta dishes. As of December 26, 2017, it operated 32 Granite City restaurants in 13 states; and 4 Cadillac Ranch restaurants in 4 states. The company was founded in 1997 and is headquartered in Bloomington, Minnesota. Granite City Food & Brewery, Ltd. is a subsidiary of Concept Development Partners LLC.

About Darden Restaurants

Darden Restaurants, Inc., through its subsidiaries, owns and operates full-service restaurants in the United States and Canada. As of May 27, 2018, it owned and operated approximately 1,746 restaurants under the Olive Garden, LongHorn Steakhouse, Cheddar's Scratch Kitchen, Yard House, The Capital Grille, Bahama Breeze, Seasons 52, and Eddie V's brands. The company was founded in 1968 and is based in Orlando, Florida.

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