Head-To-Head Contrast: Potbelly (NASDAQ:PBPB) versus Reborn Coffee (NASDAQ:REBN)

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

Insider and Institutional Ownership

1.8% of Reborn Coffee shares are owned by institutional investors. Comparatively, 72.6% of Potbelly shares are owned by institutional investors. 43.1% of Reborn Coffee shares are owned by insiders. Comparatively, 9.1% of Potbelly shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and price targets for Reborn Coffee and Potbelly, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Reborn Coffee	0	0	0	0	0.00
Potbelly	0	1	2	0	2.67

Potbelly has a consensus price target of $16.00, indicating a potential upside of 69.85%. Given Potbelly’s stronger consensus rating and higher possible upside, analysts clearly believe Potbelly is more favorable than Reborn Coffee.

Profitability

This table compares Reborn Coffee and Potbelly’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%
Potbelly	8.14%	18.69%	2.41%

Risk & Volatility

Reborn Coffee has a beta of 2.69, meaning that its stock price is 169% more volatile than the S&P 500. Comparatively, Potbelly has a beta of 1.28, meaning that its stock price is 28% more volatile than the S&P 500.

Earnings & Valuation

This table compares Reborn Coffee and Potbelly”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Reborn Coffee	$5.95 million	1.03	-$4.00 million	($1.45)	-1.14
Potbelly	$471.72 million	0.60	$5.12 million	$1.25	7.54

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

Summary

Potbelly 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 Potbelly

Potbelly Corporation, through its subsidiaries, owns, operates, and franchises Potbelly sandwich shops in the United States. The company was formerly known as Potbelly Sandwich Works, Inc. and changed its name to Potbelly Corporation in 2002. Potbelly Corporation was founded in 1977 and is headquartered in Chicago, Illinois.