Reviewing Atour Lifestyle (NASDAQ:ATAT) & Papa John’s International (NASDAQ:PZZA)

Atour Lifestyle (NASDAQ:ATAT) and Papa John’s International (NASDAQ:PZZA) are both consumer discretionary companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, risk, profitability, institutional ownership, earnings and dividends.

Profitability

This table compares Atour Lifestyle and Papa John’s International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Atour Lifestyle	16.75%	55.00%	22.21%
Papa John’s International	1.34%	-10.98%	5.68%

Analyst Recommendations

This is a summary of recent recommendations for Atour Lifestyle and Papa John’s International, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Atour Lifestyle	0	2	6	0	2.75
Papa John’s International	3	6	0	0	1.67

Atour Lifestyle currently has a consensus price target of $48.00, indicating a potential upside of 48.65%. Papa John’s International has a consensus price target of $32.00, indicating a potential upside of 63.27%. Given Papa John’s International’s higher probable upside, analysts clearly believe Papa John’s International is more favorable than Atour Lifestyle.

Dividends

Atour Lifestyle pays an annual dividend of $0.51 per share and has a dividend yield of 1.6%. Papa John’s International pays an annual dividend of $1.84 per share and has a dividend yield of 9.4%. Atour Lifestyle pays out 25.1% of its earnings in the form of a dividend. Papa John’s International pays out 232.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Papa John’s International has raised its dividend for 4 consecutive years. Papa John’s International is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk and Volatility

Atour Lifestyle has a beta of 0.66, meaning that its stock price is 34% less volatile than the S&P 500. Comparatively, Papa John’s International has a beta of 1.13, meaning that its stock price is 13% more volatile than the S&P 500.

Earnings and Valuation

This table compares Atour Lifestyle and Papa John’s International”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Atour Lifestyle	$1.40 billion	3.17	$231.80 million	$2.03	15.91
Papa John’s International	$2.05 billion	0.31	$30.53 million	$0.79	24.81

Atour Lifestyle has higher earnings, but lower revenue than Papa John’s International. Atour Lifestyle is trading at a lower price-to-earnings ratio than Papa John’s International, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

17.8% of Atour Lifestyle shares are held by institutional investors. 1.8% of Papa John’s International shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Summary

Atour Lifestyle beats Papa John’s International on 10 of the 17 factors compared between the two stocks.

About Atour Lifestyle

Atour Lifestyle Holdings Limited, through its subsidiaries, develops lifestyle brands around hotel offerings in the People’s Republic of China. The company provides hotel management services, including day-to-day management services of the hotels for the franchisees; and sells hotel supplies and other products. It also offers retail management service; investment management service; financial information service management; property management services; and software and technology services, as well as operates travel agency. Atour Lifestyle Holdings Limited was incorporated in 2012 and is headquartered in Shanghai, China.

About Papa John’s International

Papa John’s International, Inc. engages in the operation and franchise of pizza delivery and carryout restaurants. It operates through the following segments: Domestic Company-owned Restaurants, North America Franchising, North America Commissaries, International Operations, and All Others. The Domestic Company-Owned Restaurants segment consists of retail sales of pizza and side items, breadsticks, cheese sticks, chicken poppers and wings, dessert items, and canned and bottled beverages. The North America Franchising segment involves the offering of sales and support activities, development rights, and collection of royalties from franchisees located in the United States and Canada. The North America Commissaries segment includes the eleven full-service regional dough production and distribution and quality control centers. The International Operations segment represents all restaurant operations outside of the United States and Canada. The All Others segment focuses on franchise contributions to marketing funds and sale, company-owned and franchised restaurants, information systems and related services used in restaurant operations, point-of-sale system, online and other technology-based ordering platforms, printing, and promotional items. The company was founded by John H. Schnatter in 1984 and is headquartered in Louisville, KY.