Caesars Entertainment (NASDAQ:CZR) and Scientific Games (NASDAQ:SGMS) are both consumer discretionary companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, dividends, valuation, risk, institutional ownership, analyst recommendations and earnings.
Volatility & Risk
Caesars Entertainment has a beta of 3.15, meaning that its share price is 215% more volatile than the S&P 500. Comparatively, Scientific Games has a beta of 2.11, meaning that its share price is 111% more volatile than the S&P 500.
Analyst Recommendations
This is a breakdown of current ratings and price targets for Caesars Entertainment and Scientific Games, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
---|
Caesars Entertainment | 0 | 3 | 12 | 0 | 2.80 |
Scientific Games | 1 | 2 | 4 | 0 | 2.43 |
Caesars Entertainment presently has a consensus price target of $80.4688, suggesting a potential downside of 14.07%. Scientific Games has a consensus price target of $38.75, suggesting a potential downside of 18.25%. Given Caesars Entertainment's stronger consensus rating and higher probable upside, analysts plainly believe Caesars Entertainment is more favorable than Scientific Games.
Valuation and Earnings
This table compares Caesars Entertainment and Scientific Games' revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
---|
Caesars Entertainment | $2.53 billion | 7.71 | $81 million | $1.47 | 63.70 |
Scientific Games | $3.40 billion | 1.33 | $-130,000,000.00 | $0.23 | 206.09 |
Caesars Entertainment has higher earnings, but lower revenue than Scientific Games. Caesars Entertainment is trading at a lower price-to-earnings ratio than Scientific Games, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Caesars Entertainment and Scientific Games' net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
---|
Caesars Entertainment | -47.29% | -56.40% | -7.39% |
Scientific Games | -18.48% | N/A | -3.74% |
Institutional and Insider Ownership
90.7% of Caesars Entertainment shares are held by institutional investors. Comparatively, 89.5% of Scientific Games shares are held by institutional investors. 0.4% of Caesars Entertainment shares are held by insiders. Comparatively, 40.6% of Scientific Games shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
Summary
Caesars Entertainment beats Scientific Games on 8 of the 14 factors compared between the two stocks.