NasdaqGM:RICK

Stock Analysis Report

Executive Summary

RCI Hospitality Holdings, Inc., through its subsidiaries, engages in the hospitality and related businesses in the United States.

Rewards

Trading at 59.1% below its fair value

Earnings are forecast to grow 15.18% per year

Risk Analysis

Has a high level of debt

Profit margins (9.1%) are lower than last year (13.5%)



Snowflake Analysis

Very undervalued with limited growth.


Similar Companies

Share Price & News

How has RCI Hospitality Holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: RICK has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-1.7%

RICK

-5.4%

US Hospitality

-1.3%

US Market


1 Year Return

-16.6%

RICK

12.2%

US Hospitality

22.0%

US Market

Return vs Industry: RICK underperformed the US Hospitality industry which returned 20.1% over the past year.

Return vs Market: RICK underperformed the US Market which returned 24.7% over the past year.


Shareholder returns

RICKIndustryMarket
7 Day-1.7%-5.4%-1.3%
30 Day-7.9%-2.4%1.6%
90 Day-4.4%7.6%8.9%
1 Year-16.0%-16.6%15.1%12.2%24.7%22.0%
3 Year6.3%4.5%35.8%26.7%49.4%39.7%
5 Year94.5%89.2%51.4%35.4%78.1%58.5%

Price Volatility Vs. Market

How volatile is RCI Hospitality Holdings's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is RCI Hospitality Holdings undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: RICK ($18.7) is trading below our estimate of fair value ($45.77)

Significantly Below Fair Value: RICK is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: RICK is good value based on its PE Ratio (11.3x) compared to the Hospitality industry average (25.1x).

PE vs Market: RICK is good value based on its PE Ratio (11.3x) compared to the US market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: RICK is good value based on its PEG Ratio (0.7x)


Price to Book Ratio

PB vs Industry: RICK is good value based on its PB Ratio (1.1x) compared to the US Hospitality industry average (2.4x).


Next Steps

Future Growth

How is RCI Hospitality Holdings forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

15.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: RICK's forecast earnings growth (15.2% per year) is above the savings rate (1.7%).

Earnings vs Market: RICK's earnings (15.2% per year) are forecast to grow faster than the US market (14.3% per year).

High Growth Earnings: RICK's earnings are forecast to grow, but not significantly.

Revenue vs Market: RICK's revenue (5.6% per year) is forecast to grow slower than the US market (7.5% per year).

High Growth Revenue: RICK's revenue (5.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: RICK's Return on Equity is forecast to be low in 3 years time (11.9%).


Next Steps

Past Performance

How has RCI Hospitality Holdings performed over the past 5 years?

14.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: RICK has high quality earnings.

Growing Profit Margin: RICK's current net profit margins (9.1%) are lower than last year (13.5%).


Past Earnings Growth Analysis

Earnings Trend: RICK's earnings have grown by 14.5% per year over the past 5 years.

Accelerating Growth: RICK's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: RICK had negative earnings growth (-27.5%) over the past year, making it difficult to compare to the Hospitality industry average (-18.9%).


Return on Equity

High ROE: RICK's Return on Equity (9.6%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is RCI Hospitality Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: RICK's short term assets ($22.6M) do not cover its short term liabilities ($28.0M).

Long Term Liabilities: RICK's short term assets ($22.6M) do not cover its long term liabilities ($153.9M).


Debt to Equity History and Analysis

Debt Level: RICK's debt to equity ratio (86.8%) is considered high.

Reducing Debt: RICK's debt to equity ratio has increased from 75.3% to 86.8% over the past 5 years.

Debt Coverage: RICK's debt is well covered by operating cash flow (21.7%).

Interest Coverage: RICK's interest payments on its debt are well covered by EBIT (3.8x coverage).


Balance Sheet

Inventory Level: RICK has a high level of physical assets or inventory.

Debt Coverage by Assets: RICK's debt is not covered by short term assets (assets are 0.2x debt).


Next Steps

Dividend

What is RCI Hospitality Holdings's current dividend yield, its reliability and sustainability?

0.70%

Current Dividend Yield


Dividend Yield vs Market

company0.7%marketbottom25%1.4%markettop25%3.7%industryaverage3.0%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: RICK's dividend (0.7%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.4%).

High Dividend: RICK's dividend (0.7%) is low compared to the top 25% of dividend payers in the US market (3.66%).


Stability and Growth of Payments

Stable Dividend: RICK is not paying a notable dividend for the US market, therefore no need to check if payments are stable.

Growing Dividend: RICK is not paying a notable dividend for the US market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: RICK is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of RICK's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

What is the CEO of RCI Hospitality Holdings's salary, the management and board of directors tenure and is there insider trading?

9.3yrs

Average board tenure


CEO

Eric Langan (51yo)

21yrs

Tenure

US$1,126,575

Compensation

Mr. Eric Scott Langan serves as the Chairman and Chief Executive Officer of RCI Hospitality Holdings, Inc. since 1999 and has been its President since March 1999. Mr. Langan serves as the President at Jagu ...


CEO Compensation Analysis

Compensation vs Market: Eric's total compensation ($USD1.13M) is about average for companies of similar size in the US market ($USD1.08M).

Compensation vs Earnings: Eric's compensation has been consistent with company performance over the past year.


Board Age and Tenure

9.3yrs

Average Tenure

62yo

Average Age

Experienced Board: RICK's board of directors are considered experienced (9.3 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Eric Langan (51yo)

    Chairman

    • Tenure: 21yrs
    • Compensation: US$1.13m
  • Travis Reese (50yo)

    Executive VP & Director

    • Tenure: 21yrs
    • Compensation: US$403.08k
  • Phillip Marshall (70yo)

    Chief Financial Officer

    • Tenure: 12.7yrs
    • Compensation: US$311.59k

Board Members

  • Eric Langan (51yo)

    Chairman

    • Tenure: 21yrs
    • Compensation: US$1.13m
  • Travis Reese (50yo)

    Executive VP & Director

    • Tenure: 21yrs
    • Compensation: US$403.08k
  • Nour-Dean Anakar (62yo)

    Independent Director

    • Tenure: 9.3yrs
    • Compensation: US$20.00k
  • Luke Lirot (63yo)

    Independent Director

    • Tenure: 12.5yrs
    • Compensation: US$20.00k
  • Arthur Priaulx (79yo)

    Independent Director

    • Tenure: 0.4yrs
  • Yura Barabash (44yo)

    Independent Director

    • Tenure: 2.3yrs
    • Compensation: US$20.00k
  • Elaine Martin (62yo)

    Independent Director

    • Tenure: 0.4yrs

Company Information

RCI Hospitality Holdings, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: RCI Hospitality Holdings, Inc.
  • Ticker: RICK
  • Exchange: NasdaqGM
  • Founded: 1983
  • Industry: Leisure Facilities
  • Sector: Consumer Services
  • Market Cap: US$177.426m
  • Shares outstanding: 9.62m
  • Website: https://www.rcihospitality.com

Number of Employees


Location

  • RCI Hospitality Holdings, Inc.
  • 10737 Cutten Road
  • Houston
  • Texas
  • 77066
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
RICKNasdaqGM (Nasdaq Global Market)YesCommon StockUSUSDOct 1995
RIKDB (Deutsche Boerse AG)YesCommon StockDEEUROct 1995
0KT6LSE (London Stock Exchange)YesCommon StockGBUSDOct 1995

Biography

RCI Hospitality Holdings, Inc., through its subsidiaries, engages in the hospitality and related businesses in the United States. It operates in Nightclubs, Bombshells, and Media Group segments. The company owns and/or operates upscale adult nightclubs serving primarily businessmen and professionals under the Rick’s Cabaret, Jaguars Club, Tootsie’s Cabaret, XTC Cabaret, Club Onyx, Hoops Cabaret and Sports Bar, Scarlett’s Cabaret, Temptations Adult Cabaret, Foxy’s Cabaret, Vivid Cabaret, Downtown Cabaret, Cabaret East, The Seville, Silver City Cabaret, and Kappa Men’s Club. It also operates restaurants and sports bars under the Bombshells Restaurant & Bar brand; and dance clubs under the Studio 80 brand. As of February 11, 2019, the company operated 46 units, including 39 nightclub units and 7 Bombshell units. In addition, it owns two national industry trade publications serving the adult nightclubs industry and the adult retail products industry; a national industry convention and tradeshow; and two national industry award shows, as well as approximately a dozen industry and social media Websites. The company was formerly known as Rick’s Cabaret International, Inc. and changed its name to RCI Hospitality Holdings, Inc. in August 2014. RCI Hospitality Holdings, Inc. was founded in 1983 and is based in Houston, Texas. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/01/26 00:02
End of Day Share Price2020/01/24 00:00
Earnings2019/06/30
Annual Earnings2018/09/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.