Contrasting Portillo’s (NASDAQ:PTLO) & Reborn Coffee (NASDAQ:REBN)

Reborn Coffee (NASDAQ:REBN) and Portillo’s (NASDAQ:PTLO) are both small-cap consumer staples companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, analyst recommendations, valuation, institutional ownership, dividends, risk and profitability.

Volatility and Risk

Reborn Coffee has a beta of 2.26, suggesting that its stock price is 126% more volatile than the S&P 500. Comparatively, Portillo’s has a beta of 1.82, suggesting that its stock price is 82% more volatile than the S&P 500.

Valuation & Earnings

This table compares Reborn Coffee and Portillo’s”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Reborn Coffee	$5.93 million	2.51	-$4.00 million	($1.64)	-1.99
Portillo’s	$710.55 million	1.21	$18.42 million	$0.46	25.07

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

Profitability

This table compares Reborn Coffee and Portillo’s’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Reborn Coffee	-67.56%	-171.86%	-40.14%
Portillo’s	3.65%	5.62%	1.82%

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Reborn Coffee and Portillo’s, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Reborn Coffee	0	0	0	0	0.00
Portillo’s	0	5	3	0	2.38

Portillo’s has a consensus price target of $13.71, suggesting a potential upside of 18.94%. Given Portillo’s’ stronger consensus rating and higher probable upside, analysts plainly believe Portillo’s is more favorable than Reborn Coffee.

Insider and Institutional Ownership

1.8% of Reborn Coffee shares are owned by institutional investors. Comparatively, 98.3% of Portillo’s shares are owned by institutional investors. 43.1% of Reborn Coffee shares are owned by insiders. Comparatively, 6.6% of Portillo’s shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Summary

Portillo’s beats Reborn Coffee on 11 of the 14 factors compared between the two stocks.

About Reborn Coffee

Reborn Coffee, Inc., through its subsidiaries, operates and franchises retail locations, kiosks, and cafes that focus on serving specialty-roasted coffee in California. It purchases, roasts, and sells coffee, tea and other beverages, and various food items. It offers products in various form factors, such as whole bean roasted coffee bags, single-serve drip bags, and pour over packs. The company also offers its products online. Reborn Coffee, Inc. was founded in 2014 and is headquartered in Brea, California.

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.