How Much Is Ark Restaurants Corp. (ARKR) Worth? – Darden Restaurants, Inc. (DRI), Einstein Noah Restaurant Group, Inc. (BAGL)

Among the three, Einstein Noah Restaurant Group, Inc. (NASDAQ:BAGL) generated the lowest operating margin at 6.7% while Darden is the most profitable company with a nearly 9% operating margin. Ark pays the highest dividend yield, at 4.7% while the dividend yields of Einstein Noah and Darden Restaurants, Inc. (NYSE:DRI) are 3.3% and 4.1%, respectively. Among the three, Einstein Noah utilizes a lot of leverage in its operation, with a debt/equity ratio of 4.8. Ark leverages quite minimal, while Darden Restaurants, Inc. (NYSE:DRI)’ debt/equity ratio is quite reasonable at 1.4.

Foolish bottom line

A $22 offer seems to undervalue Ark Restaurants Corp. (NASDAQ:ARKR). I personally think Ark should have a higher valuation than Einstein Noah Restaurant Group, Inc. (NASDAQ:BAGL) due to the higher operating margin and lower leverage. If it is valued similarly to Einstein Noah at 7.7 times EV/EBITDA, Ark should be worth around $35 per share, 60% higher than Landry’s operating price.

The article How Much Is Ark Restaurants Worth? originally appeared on Fool.com and is written by Anh HOANG

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