Analyzing StoneMor Partners L.P. (STON) and Regis Corporation (RGS)

Regis Corporation (NYSE: RGS) and StoneMor Partners L.P. (NYSE:STON) are both small-cap retail/wholesale companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, dividends, profitabiliy, risk, institutional ownership and earnings.

Earnings and Valuation

This table compares Regis Corporation and StoneMor Partners L.P.’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Regis Corporation $1.72 billion 0.27 $71.85 million ($0.26) -38.81
StoneMor Partners L.P. $316.56 million 1.01 $4.14 million ($1.03) -8.77

Regis Corporation has higher revenue and earnings than StoneMor Partners L.P.. Regis Corporation is trading at a lower price-to-earnings ratio than StoneMor Partners L.P., indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Regis Corporation has a beta of 1.49, meaning that its share price is 49% more volatile than the S&P 500. Comparatively, StoneMor Partners L.P. has a beta of 0.77, meaning that its share price is 23% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations and price targets for Regis Corporation and StoneMor Partners L.P., as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Regis Corporation 0 0 0 0 N/A
StoneMor Partners L.P. 0 3 1 0 2.25

StoneMor Partners L.P. has a consensus target price of $12.00, suggesting a potential upside of 32.89%. Given StoneMor Partners L.P.’s higher probable upside, analysts plainly believe StoneMor Partners L.P. is more favorable than Regis Corporation.

Profitability

This table compares Regis Corporation and StoneMor Partners L.P.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Regis Corporation -0.69% -0.01% N/A
StoneMor Partners L.P. N/A N/A N/A

Dividends

StoneMor Partners L.P. pays an annual dividend of $1.32 per share and has a dividend yield of 14.6%. Regis Corporation does not pay a dividend. StoneMor Partners L.P. pays out -128.2% of its earnings in the form of a dividend.

Insider & Institutional Ownership

96.4% of Regis Corporation shares are owned by institutional investors. Comparatively, 24.5% of StoneMor Partners L.P. shares are owned by institutional investors. 24.0% of Regis Corporation shares are owned by insiders. Comparatively, 9.8% of StoneMor Partners L.P. shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Summary

StoneMor Partners L.P. beats Regis Corporation on 7 of the 13 factors compared between the two stocks.

About Regis Corporation

Regis Corporation owns, franchises and operates beauty salons. The Company operates through three segments: North American Value, North American Premium and International. As of June 30, 2016, the Company’s North American Value salon operations consisted of 5,784 Company-owned salons and 2,496 franchised salons operating in the United States, Canada and Puerto Rico. As of June 30, 2016, the Company’s North American Premium salon operations consisted of 680 Company-owned salons operating in the United States, Canada, and Puerto Rico. As of June 30, 2016, the Company’s International operations consisted of 328 Company-owned salons in the United Kingdom. The services supplied by its salons include haircutting and styling, hair coloring and other services. As of June 30, 2016, it owned, franchised or held ownership interests in 9,483 locations around the world. The Company’s salons operate primarily under the trade names of SmartStyle, Supercuts, MasterCuts, Regis Salons and Cost Cutters.

About StoneMor Partners L.P.

StoneMor Partners L.P. owns and operates cemeteries and funeral homes. The Company operates through two segments: Cemetery Operations and Funeral Homes. Its Cemetery Operations segment sells interment rights, caskets, burial vaults, cremation niches, markers and other cemetery related merchandise. Its Funeral Homes segment offers a range of services, including family consultation, final expense insurance products, the removal and preparation of remains, provision of caskets and related funeral merchandise, the use of funeral home facilities for visitation, worship and performance of funeral services, and transportation services. It sells cemetery products and services both at the time of death, which it refers to as at-need, and prior to the time of death, which it refers to as pre-need. It operates approximately 310 cemeteries in over 30 states and Puerto Rico, and approximately 100 funeral homes in over 20 states and Puerto Rico.

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