Franchise Group (NASDAQ: FRG) is one of 27 publicly-traded companies in the “Patent owners & lessors” industry, but how does it contrast to its rivals? We will compare Franchise Group to similar companies based on the strength of its risk, institutional ownership, analyst recommendations, profitability, earnings, dividends and valuation.
Institutional and Insider Ownership
73.1% of Franchise Group shares are owned by institutional investors. Comparatively, 44.9% of shares of all “Patent owners & lessors” companies are owned by institutional investors. 30.1% of Franchise Group shares are owned by insiders. Comparatively, 22.9% of shares of all “Patent owners & lessors” companies are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Analyst Ratings
This is a breakdown of recent ratings and recommmendations for Franchise Group and its rivals, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Franchise Group | 0 | 0 | 6 | 0 | 3.00 |
| Franchise Group Competitors | 68 | 376 | 826 | 16 | 2.61 |
Franchise Group presently has a consensus price target of $53.83, indicating a potential upside of 9.60%. As a group, “Patent owners & lessors” companies have a potential upside of 51.77%. Given Franchise Group’s rivals higher probable upside, analysts plainly believe Franchise Group has less favorable growth aspects than its rivals.
Dividends
Franchise Group pays an annual dividend of $1.50 per share and has a dividend yield of 3.1%. Franchise Group pays out 29.9% of its earnings in the form of a dividend. As a group, “Patent owners & lessors” companies pay a dividend yield of 2.0% and pay out 43.8% of their earnings in the form of a dividend. Franchise Group has raised its dividend for 2 consecutive years. Franchise Group is clearly a better dividend stock than its rivals, given its higher yield and lower payout ratio.
Profitability
This table compares Franchise Group and its rivals’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Franchise Group | 7.56% | 25.25% | 4.79% |
| Franchise Group Competitors | -6,804.63% | 0.42% | -2.25% |
Earnings & Valuation
This table compares Franchise Group and its rivals top-line revenue, earnings per share and valuation.
| Gross Revenue | Net Income | Price/Earnings Ratio | |
| Franchise Group | $2.15 billion | $25.06 million | 9.78 |
| Franchise Group Competitors | $327.64 million | $21.07 million | 15.09 |
Franchise Group has higher revenue and earnings than its rivals. Franchise Group is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.
Risk and Volatility
Franchise Group has a beta of 1.81, indicating that its stock price is 81% more volatile than the S&P 500. Comparatively, Franchise Group’s rivals have a beta of 0.89, indicating that their average stock price is 11% less volatile than the S&P 500.
Summary
Franchise Group beats its rivals on 12 of the 15 factors compared.
About Franchise Group
Franchise Group, Inc. is a holding company, which engages in the provision of tax return preparation and related services and products. It operates through the following segments: Vitamin Shoppe, American Freight, Liberty Tax and Buddy’s. The Vitamin Shoppe segment is an omni-channel specialty retailer of vitamins, herbs, specialty supplements, sports nutrition and other health and wellness products. The American Freight segment is a retail chain offering in-store and online access to furniture, mattresses, new and out-of-box home appliances and home accessories at discount prices. The Liberty Tax segment provides income tax services. The Buddy’s segment is a specialty retailer of high quality, name-brand consumer electronics, residential furniture, appliances and household accessories through rent-to-own agreements. The firm offers personal and business tax preparation services, facilitates refund-based tax settlement financial products, and online tax preparation services. The company was founded by Danny Hewitt and John T. Hewitt on September 1, 1997 and is headquartered in Virginia Beach, VA.