Financial Review: Regis (RGS) versus The Competition

Regis (NASDAQ:RGS) is one of 166 public companies in the “Diversified Consumer Services” industry, but how does it compare to its competitors? We will compare Regis to similar companies based on the strength of its valuation, risk, earnings, analyst recommendations, profitability, dividends and institutional ownership.

Profitability

This table compares Regis and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Regis	3.09%	4.10%	1.36%
Regis Competitors	-3.71%	-28.48%	2.39%

Risk & Volatility

Regis has a beta of 1.44, suggesting that its stock price is 44% more volatile than the S&P 500. Comparatively, Regis’ competitors have a beta of 0.50, suggesting that their average stock price is 50% less volatile than the S&P 500.

Valuation and Earnings

This table compares Regis and its competitors gross revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Regis	$219.87 million	$6.94 million	10.32
Regis Competitors	$3.60 billion	$219.82 million	11.58

Regis’ competitors have higher revenue and earnings than Regis. Regis is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Dividends

Regis pays an annual dividend of $0.24 per share and has a dividend yield of 1.0%. Regis pays out 9.9% of its earnings in the form of a dividend. As a group, “Diversified Consumer Services” companies pay a dividend yield of 5.9% and pay out 36.3% of their earnings in the form of a dividend.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Regis and its competitors, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Regis	0	1	1	0	2.50
Regis Competitors	1443	3447	5286	197	2.41

Regis presently has a consensus price target of $42.00, suggesting a potential upside of 68.13%. As a group, “Diversified Consumer Services” companies have a potential upside of 62.78%. Given Regis’ stronger consensus rating and higher probable upside, research analysts plainly believe Regis is more favorable than its competitors.

Insider and Institutional Ownership

31.5% of Regis shares are owned by institutional investors. Comparatively, 49.0% of shares of all “Diversified Consumer Services” companies are owned by institutional investors. 8.0% of Regis shares are owned by insiders. Comparatively, 19.5% of shares of all “Diversified Consumer Services” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Summary

Regis competitors beat Regis on 9 of the 15 factors compared.

About Regis

Regis Corporation owns, operates, and franchises hairstyling and hair care salons in the United States, the United Kingdom, Canada, and Puerto Rico. The company operates in two segments, Franchise Salons and Company-owned Salons. Its salons provide haircutting and styling, including shampooing and conditioning; hair coloring; and other services, as well as sells various hair care and other beauty products. The company also offers OpenSalon Pro, a back-office salon management system; and Opensalon mobile application. Regis Corporation operates its salons primarily under the SmartStyle, Supercuts, Cost Cutters, Roosters, and First Choice Haircutters names. As of June 30, 2021, the company operated 5,917 salons, such as 5,563 franchised salons, 276 company-owned salons, and 78 non-controlling ownership salons. It also operates accredited cosmetology schools. The company was founded in 1922 and is headquartered in Minneapolis, Minnesota.