SHAK vs TXRH vs MCD vs RRGB

For growth investors, Shake Shack Inc.

(SHAK) is the stronger pick with 15. 4% revenue growth year-over-year, versus -3. 1% for Red Robin Gourmet Burgers, Inc. (RRGB). McDonald's Corporation (MCD) offers the better valuation at 23. 7x trailing P/E (21. 5x forward), making it the more compelling value choice. Analysts rate McDonald's Corporation (MCD) a "Buy" — based on 62 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.

On trailing P/E, McDonald's Corporation (MCD) is the cheapest at 23.

7x versus Shake Shack Inc. at 63. 5x. On forward P/E, McDonald's Corporation is actually cheaper at 21. 5x. The PEG ratio (P/E divided by earnings growth rate) is the most growth-adjusted single valuation metric: Texas Roadhouse, Inc. wins at 1. 17x versus McDonald's Corporation's 2. 81x — a reasonable growth-adjusted valuation.

Over the past 5 years, Texas Roadhouse, Inc.

(TXRH) delivered a total return of +61. 6%, compared to -89. 7% for Red Robin Gourmet Burgers, Inc. (RRGB). Over 10 years, the gap is even starker: TXRH returned +288. 0% versus RRGB's -94. 4%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.

By beta (market sensitivity over 5 years), McDonald's Corporation (MCD) is the lower-risk stock at 0.

11β versus Red Robin Gourmet Burgers, Inc. 's 2. 10β — meaning RRGB is approximately 1782% more volatile than MCD relative to the S&P 500. On balance sheet safety, Texas Roadhouse, Inc. (TXRH) carries a lower debt/equity ratio of 127% versus 163% for Shake Shack Inc. — giving it more financial flexibility in a downturn.

By revenue growth (latest reported year), Shake Shack Inc.

(SHAK) is pulling ahead at 15. 4% versus -3. 1% for Red Robin Gourmet Burgers, Inc. (RRGB). On earnings-per-share growth, the picture is similar: Shake Shack Inc. grew EPS 354. 2% year-over-year, compared to -5. 7% for Texas Roadhouse, Inc.. Over a 3-year CAGR, SHAK leads at 17. 1% annualised revenue growth. Higher growth typically commands a higher valuation multiple — check whether the premium P/E or P/S is justified by the growth rate using the PEG ratio.

McDonald's Corporation (MCD) is the more profitable company, earning 31.

9% net margin versus -1. 9% for Red Robin Gourmet Burgers, Inc. — meaning it keeps 31. 9% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: MCD leads at 46. 1% versus 0. 2% for RRGB. At the gross margin level — before operating expenses — RRGB leads at 68. 0%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.

The PEG ratio (forward P/E divided by expected earnings growth rate) is the most precise measure of undervaluation relative to growth potential.

By this metric, Texas Roadhouse, Inc. (TXRH) is the more undervalued stock at a PEG of 1. 17x versus McDonald's Corporation's 2. 81x. A PEG below 1. 5 suggests fair-to-attractive pricing relative to expected growth. On forward earnings alone, McDonald's Corporation (MCD) trades at 21. 5x forward P/E versus 50. 2x for Shake Shack Inc. — 28. 7x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for RRGB: 90. 7% to $7. 00.

In this comparison, MCD (2.

5% yield), TXRH (1. 7% yield) pay a dividend. SHAK, RRGB do not pay a meaningful dividend and should not be held primarily for income.

For long-horizon retirement investors, McDonald's Corporation (MCD) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β 0.

11), 2. 5% yield, +157. 7% 10Y return). Red Robin Gourmet Burgers, Inc. (RRGB) carries a higher beta of 2. 10 — meaning larger drawdowns in market downturns, which matters significantly when you cannot wait years for a recovery. Both have compounded well over 10 years (MCD: +157. 7%, RRGB: -94. 4%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.

Both stocks operate in the Consumer Cyclical sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both.

In terms of investment character: SHAK is a small-cap high-growth stock; TXRH is a mid-cap quality compounder stock; MCD is a large-cap quality compounder stock; RRGB is a small-cap quality compounder stock. TXRH, MCD pay a dividend while SHAK, RRGB do not, making them suitable for different income and tax situations. These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.