Better choice than Sonic
Sonic Drive-In pays an annual dividend of $0.64 per share and has a dividend yield of 1.8%. Darden Restaurants pays an annual dividend of $2.52 per share and has a dividend yield of 2.3%. Sonic Drive-In pays out 51.2% of its earnings in the form of a dividend. Darden Restaurants pays out 62.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.
Institutional & Insider Ownership
89.2% of Darden Restaurants shares are held by institutional investors. 6.2% of Sonic Drive-In shares are held by company insiders. Comparatively, 0.6% of Darden Restaurants 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.
This table compares Sonic Drive-In and Darden Restaurants’ net margins, return on equity and return on assets.
Net Margins Return on Equity Return on Assets
Sonic Drive-In 16.01% -25.75% 9.94%
Darden Restaurants 6.92% 28.12% 10.81%
Volatility and Risk
Sonic Drive-In has a beta of 1.45, meaning that its stock price is 45% more volatile than the S&P 500. Comparatively, Darden Restaurants has a beta of 0.2, meaning that its stock price is 80% less volatile than the S&P 500.
Darden Restaurants beats Sonic Drive-In on 10 of the 16 factors compared between the two stocks. https://www.thestockobserver.com/2018/06/22/sonic-drive-in-sonc-versus-darden-restaurants-dri-head-to-head-review.html