Head-To-Head Review: Noodles & Company (NASDAQ:NDLS) and TH International (NASDAQ:THCH)

TH International (NASDAQ:THCH) and Noodles & Company (NASDAQ:NDLS) are both small-cap retail/wholesale companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, valuation, analyst recommendations, profitability, dividends, earnings and risk.

Earnings and Valuation

This table compares TH International and Noodles & Company’s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
TH International	$221.94 million	0.49	-$123.81 million	($0.74)	-0.88
Noodles & Company	$503.40 million	0.16	-$9.86 million	($0.29)	-6.17

Noodles & Company has higher revenue and earnings than TH International. Noodles & Company is trading at a lower price-to-earnings ratio than TH International, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

TH International has a beta of 0.27, suggesting that its share price is 73% less volatile than the S&P 500. Comparatively, Noodles & Company has a beta of 1.77, suggesting that its share price is 77% more volatile than the S&P 500.

Profitability

This table compares TH International and Noodles & Company’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
TH International	-53.46%	N/A	-20.48%
Noodles & Company	-2.58%	-26.88%	-2.17%

Institutional and Insider Ownership

91.9% of TH International shares are held by institutional investors. Comparatively, 65.7% of Noodles & Company shares are held by institutional investors. 2.9% of Noodles & Company shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for TH International and Noodles & Company, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
TH International	0	0	0	0	N/A
Noodles & Company	0	1	2	0	2.67

Noodles & Company has a consensus target price of $3.67, indicating a potential upside of 104.84%. Given Noodles & Company’s higher probable upside, analysts clearly believe Noodles & Company is more favorable than TH International.

Summary

Noodles & Company beats TH International on 9 of the 13 factors compared between the two stocks.

About TH International

TH International Limited operates Tim Hortons coffee shops in mainland China, Hong Kong, and Macau. The company offers brewed tea, coffee, milk tea, lemonade, hot chocolate, and coffee drinks. It is also involved in franchise related business. The company is based in Shanghai, the People's Republic of China.

About Noodles & Company

Noodles & Company, a restaurant concept company, develops and operates fast-casual restaurants. It offers cooked-to-order dishes, including noodles and pasta, soups, salads, and appetizers. It operates company owned locations and franchise locations. The company was founded in 1995 and is based in Broomfield, Colorado.