Restaurant Group PLC (LON:RTN) $RTN

The Restaurant Group PLC is a United Kingdom-based operator of more than 500 restaurants and pub restaurants offering table service, counter service, sandwich shops, pubs and bars. The company also operates a concessions business, primarily in United Kingdom airports.

The Restaurant Group operates under the brands Frankie & Benny's, Chiquito and Coast to Coast. Frankie & Benny's is classic American and Italian style food and drinks. Chiquito offers a range of authentic Mexican and Tex-Mex dishes. Coast to Coast offers classic American food including double burgers, stone-baked calzones, distinctive steaks, seafood and South-West American specials.

TRG is a growth stock. It targets 850 to 900 locations within the next 8-10 years. That means the company would more than double its revenue by 2025 if everything went according to plan. That’s a big ‘if’.

The stock is very cheap. In relative terms, it’s one of the cheapest stocks we’ve written about in Singular Diligence. Right now, TRG trades at a huge discount to U.S. restaurant chains and prices paid in the past for acquisitions of U.K. restaurants. TRG trades at an unusual discount for a restaurant that isn’t seriously troubled.

The Restaurant Group combines relatively good growth prospects with a relatively low price. It
is cheaper than many peers while also having better growth prospects than those peers.

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