Red Rock Resorts (NASDAQ:RRR) and Studio City International (NYSE:MSC) are both consumer discretionary companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, institutional ownership, profitability, dividends, valuation, analyst recommendations and earnings.
Insider & Institutional Ownership
52.4% of Red Rock Resorts shares are held by institutional investors. 43.8% of Red Rock Resorts shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
Analyst Recommendations
This is a breakdown of recent ratings and price targets for Red Rock Resorts and Studio City International, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Red Rock Resorts | 0 | 2 | 8 | 0 | 2.80 |
| Studio City International | 0 | 0 | 0 | 0 | N/A |
Red Rock Resorts presently has a consensus price target of $24.25, suggesting a potential downside of 28.89%. Given Red Rock Resorts' higher possible upside, research analysts plainly believe Red Rock Resorts is more favorable than Studio City International.
Volatility & Risk
Red Rock Resorts has a beta of 2.55, indicating that its stock price is 155% more volatile than the S&P 500. Comparatively, Studio City International has a beta of -0.84, indicating that its stock price is 184% less volatile than the S&P 500.
Valuation & Earnings
This table compares Red Rock Resorts and Studio City International's top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Red Rock Resorts | $1.86 billion | 2.18 | $-3,350,000.00 | $0.18 | 191.61 |
| Studio City International | $626.73 million | 1.62 | $43.63 million | $0.75 | 17.20 |
Studio City International has lower revenue, but higher earnings than Red Rock Resorts. Studio City International is trading at a lower price-to-earnings ratio than Red Rock Resorts, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Red Rock Resorts and Studio City International's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Red Rock Resorts | -13.48% | -2.52% | -0.36% |
| Studio City International | N/A | -21.78% | -9.04% |
Summary
Red Rock Resorts beats Studio City International on 9 of the 13 factors compared between the two stocks.
