Studio City International (NYSE:MSC) and Boyd Gaming (NYSE:BYD) are both consumer discretionary companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, earnings, institutional ownership, dividends, valuation and risk.

Dividends

Boyd Gaming pays an annual dividend of $0.24 per share and has a dividend yield of 0.9%. Studio City International does not pay a dividend. Boyd Gaming pays out 18.0% of its earnings in the form of a dividend.

Earnings and Valuation

This table compares Studio City International and Boyd Gaming’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Studio City International $571.21 million 2.83 -$20.74 million ($0.24) -72.90
Boyd Gaming $2.63 billion 1.16 $115.05 million $1.33 20.56

Boyd Gaming has higher revenue and earnings than Studio City International. Studio City International is trading at a lower price-to-earnings ratio than Boyd Gaming, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent recommendations for Studio City International and Boyd Gaming, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Studio City International 2 0 0 0 1.00
Boyd Gaming 0 1 7 0 2.88

Studio City International currently has a consensus target price of $20.00, suggesting a potential upside of 14.31%. Boyd Gaming has a consensus target price of $36.57, suggesting a potential upside of 33.72%. Given Boyd Gaming’s stronger consensus rating and higher probable upside, analysts clearly believe Boyd Gaming is more favorable than Studio City International.

Profitability

This table compares Studio City International and Boyd Gaming’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Studio City International N/A N/A N/A
Boyd Gaming 4.38% 13.41% 2.93%

Insider & Institutional Ownership

18.7% of Studio City International shares are owned by institutional investors. Comparatively, 71.2% of Boyd Gaming shares are owned by institutional investors. 29.4% of Boyd Gaming shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Summary

Boyd Gaming beats Studio City International on 13 of the 15 factors compared between the two stocks.

About Studio City International

Studio City International Holdings Limited operates a gaming, retail, and entertainment resort in Cotai, Macau. The company also operates Studio City Casino with 250 mass market gaming tables; approximately 970 gaming machines; and 45 VIP rolling chip tables. In addition, its resort provides various non-gaming facilities, including approximately 1,600 hotel rooms; various food and beverage establishments; retail space; figure-8 Ferris wheel; a Warner Bros.-themed family entertainment center; a 4-D Batman flight simulator; a night club; and a 5,000-seat live performance arena. The company was formerly known as Cyber One Agents Limited and changed its name to Studio City International Holdings Limited in January 2012. The company was founded in 2000 and is based in Central, Hong Kong. Studio City International Holdings Limited is a subsidiary of Melco Resorts & Entertainment Limited.

About Boyd Gaming

Boyd Gaming Corporation, together with its subsidiaries, operates as a multi-jurisdictional gaming company. It operates through three segments: Las Vegas Locals, Downtown Las Vegas, and Midwest & South. As of December 31, 2018, the company operated 29 gaming entertainment properties located in Nevada, Illinois, Indiana, Iowa, Kansas, Louisiana, Mississippi, Missouri, Ohio, and Pennsylvania. It also engages in owning and operating a travel agency; and the captive insurance business that underwrites travel-related insurance. The company was founded in 1975 and is headquartered in Las Vegas, Nevada.

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