Jack in the Box (NASDAQ:JACK) versus Portillo’s (NASDAQ:PTLO) Critical Comparison

Portillo’s (NASDAQ:PTLO) and Jack in the Box (NASDAQ:JACK) are both small-cap retail/wholesale companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, dividends, earnings, risk, analyst recommendations, valuation and profitability.

Profitability

This table compares Portillo’s and Jack in the Box’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Portillo’s	3.65%	5.62%	1.82%
Jack in the Box	-2.34%	-15.79%	4.36%

Volatility and Risk

Portillo’s has a beta of 1.81, suggesting that its share price is 81% more volatile than the S&P 500. Comparatively, Jack in the Box has a beta of 1.94, suggesting that its share price is 94% more volatile than the S&P 500.

Institutional and Insider Ownership

98.3% of Portillo’s shares are held by institutional investors. Comparatively, 99.8% of Jack in the Box shares are held by institutional investors. 6.6% of Portillo’s shares are held by insiders. Comparatively, 1.4% of Jack in the Box shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Portillo’s and Jack in the Box”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Portillo’s	$713.80 million	1.45	$18.42 million	$0.42	33.21
Jack in the Box	$1.57 billion	0.46	-$36.69 million	($1.95)	-19.46

Portillo’s has higher earnings, but lower revenue than Jack in the Box. Jack in the Box is trading at a lower price-to-earnings ratio than Portillo’s, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current ratings and target prices for Portillo’s and Jack in the Box, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Portillo’s	0	3	4	0	2.57
Jack in the Box	1	10	6	0	2.29

Portillo’s presently has a consensus price target of $14.14, indicating a potential upside of 1.38%. Jack in the Box has a consensus price target of $49.88, indicating a potential upside of 31.46%. Given Jack in the Box’s higher probable upside, analysts clearly believe Jack in the Box is more favorable than Portillo’s.

Summary

Portillo’s beats Jack in the Box on 8 of the 14 factors compared between the two stocks.

About Portillo’s

Portillo’s Inc. owns and operates fast casual restaurants in the United States. The company offers Chicago-style hot dogs and sausages, Italian beef sandwiches, char-grilled burgers, chopped salads, crinkle-cut French fries, homemade chocolate cakes, and chocolate cake shake. It offers its products through its website, application, and certain third-party platforms. Portillo’s Inc. was founded in 1963 and is based in Oak Brook, Illinois.

About Jack in the Box

Jack in the Box Inc. operates and franchises Jack in the Box and Del Taco quick-service restaurants in the United States. The company was founded in 1951 and is headquartered in San Diego, California.