Ruth's Hospitality Group: A Neglected Stock

| About: Ruth's Hospitality (RUTH)

Over the past five years, both sub-sectors (restaurants & luxury retail) of the retail industry that Ruth's Hospitality Group (NASDAQ:RUTH) is a part of have been incredibly strong performers. While it is said that "a rising tide lifts all boats," RUTH has not rallied like many of its peers. The five-year performance of some luxury retail & restaurant stocks is shown below.

Luxury Retail

Tiffany (NYSE:TIF): +48.87%

Ralph Lauren Corp (NYSE:RL) +73.7%

Coach Inc (NYSE:COH) + 35.36%

Nordstrom (NYSE:JWN) -11.56%


McDonald's (NYSE:MCD) +126.93%

Chesecake Factory (NASDAQ:CAKE) +4.77%

Darden Restaurants (NYSE:DRI) +13.01%

While both luxury retailers and restaurant stocks have done well over the past five years, RUTH has not participated. Shares of RUTH are down 72.72% over the same period.

(Click charts to expand)


Considering luxury retailers and restaurants have been doing well, it might be time for RUTH to play catch-up.


Forward PE Ratio: 13.93

Year-over-year growth rate: 18.8%

RUTH's PE ratio compares well with the previously mentioned companies

  • RL has a forward PE ratio of 17.63
  • COH has a forward PE ratio of 15.54
  • MCD has a forward PE ratio of 17.5
  • CAKE has a forward PE ratio of 15.67

RUTH's Portfolio of Restaurants

  • 131 Ruth's Chirs Steakhouse restaurants (64 company owned; 67 franchise owned)
  • 14 International Franchises
  • 20 Mitchell's Fish Market restaurants
  • 3 Cameron's Steakhouse restaurants

Takeover Potential

Both McCormick & Schmick (NASDAQ:MSSR) and Morton's (NYSE:MRT-OLD) have recently been bought out by Landry's. RUTH 's market cap is just over 200 million. This means RUTH could easily be taken over by many potential suitors.


RUTH is a stock that offers a good value for investors looking to play luxury retail & restaurants.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.