The Walt Disney (NYSE:DIS) and Charter Communications (NASDAQ:CHTR) are both large-cap consumer discretionary companies, but which is the superior stock? We will contrast the two businesses based on the strength of their risk, earnings, valuation, institutional ownership, analyst recommendations, dividends and profitability.
Risk and Volatility
The Walt Disney has a beta of 1.2, meaning that its share price is 20% more volatile than the S&P 500. Comparatively, Charter Communications has a beta of 1, meaning that its share price has a similar volatility profile to the S&P 500.
Profitability
This table compares The Walt Disney and Charter Communications' net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| The Walt Disney | -4.38% | 4.05% | 1.83% |
| Charter Communications | 5.70% | 7.50% | 1.87% |
Analyst Recommendations
This is a summary of current ratings and recommmendations for The Walt Disney and Charter Communications, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| The Walt Disney | 1 | 7 | 23 | 0 | 2.71 |
| Charter Communications | 0 | 5 | 19 | 1 | 2.84 |
The Walt Disney currently has a consensus target price of $162.9310, indicating a potential downside of 4.96%. Charter Communications has a consensus target price of $655.44, indicating a potential upside of 4.22%. Given Charter Communications' stronger consensus rating and higher possible upside, analysts clearly believe Charter Communications is more favorable than The Walt Disney.
Earnings and Valuation
This table compares The Walt Disney and Charter Communications' top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| The Walt Disney | $65.39 billion | 4.75 | $-2,864,000,000.00 | $2.02 | 84.87 |
| Charter Communications | $45.76 billion | 2.75 | $1.67 billion | $7.54 | 83.41 |
Charter Communications has lower revenue, but higher earnings than The Walt Disney. Charter Communications is trading at a lower price-to-earnings ratio than The Walt Disney, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
62.8% of The Walt Disney shares are held by institutional investors. Comparatively, 70.1% of Charter Communications shares are held by institutional investors. 0.3% of The Walt Disney shares are held by insiders. Comparatively, 1.2% of Charter Communications shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Summary
Charter Communications beats The Walt Disney on 11 of the 15 factors compared between the two stocks.
