Walt Disney Company (The) (NYSE: DIS) and Gray Television (NYSE:GTN) are both consumer discretionary companies, but which is the superior stock? We will contrast the two businesses based on the strength of their risk, institutional ownership, dividends, profitabiliy, analyst recommendations, earnings and valuation.

Earnings and Valuation

This table compares Walt Disney Company (The) and Gray Television’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Walt Disney Company (The) $55.54 billion 2.98 $17.10 billion $5.74 18.42
Gray Television $842.20 million 1.11 $317.79 million $0.87 16.15

Walt Disney Company (The) has higher revenue and earnings than Gray Television. Gray Television is trading at a lower price-to-earnings ratio than Walt Disney Company (The), indicating that it is currently the more affordable of the two stocks.

Dividends

Walt Disney Company (The) pays an annual dividend of $1.56 per share and has a dividend yield of 1.5%. Gray Television does not pay a dividend. Walt Disney Company (The) pays out 27.2% of its earnings in the form of a dividend.

Profitability

This table compares Walt Disney Company (The) and Gray Television’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Walt Disney Company (The) 16.63% 19.81% 10.27%
Gray Television 7.57% 17.77% 3.11%

Institutional & Insider Ownership

62.5% of Walt Disney Company (The) shares are held by institutional investors. Comparatively, 87.3% of Gray Television shares are held by institutional investors. 13.0% of Walt Disney Company (The) shares are held by company insiders. Comparatively, 12.0% of Gray Television shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings for Walt Disney Company (The) and Gray Television, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Walt Disney Company (The) 4 13 15 0 2.34
Gray Television 0 0 4 0 3.00

Walt Disney Company (The) presently has a consensus target price of $116.52, indicating a potential upside of 10.19%. Gray Television has a consensus target price of $17.67, indicating a potential upside of 25.74%. Given Gray Television’s stronger consensus rating and higher possible upside, analysts plainly believe Gray Television is more favorable than Walt Disney Company (The).

Volatility & Risk

Walt Disney Company (The) has a beta of 1.39, suggesting that its stock price is 39% more volatile than the S&P 500. Comparatively, Gray Television has a beta of 3.29, suggesting that its stock price is 229% more volatile than the S&P 500.

Summary

Walt Disney Company (The) beats Gray Television on 11 of the 16 factors compared between the two stocks.

About Walt Disney Company (The)

The Walt Disney Company is an entertainment company. The Company operates in four business segments: Media Networks, Parks and Resorts, Studio Entertainment, and Consumer Products & Interactive Media. The media networks segment includes cable and broadcast television networks, television production and distribution operations, domestic television stations, and radio networks and stations. Under the Parks and Resorts segment, the Company’s Walt Disney Imagineering unit designs and develops new theme park concepts and attractions, as well as resort properties. The studio entertainment segment produces and acquires live-action and animated motion pictures, direct-to-video content, musical recordings and live stage plays. It also develops and publishes games, primarily for mobile platforms, books, magazines and comic books. The Company distributes merchandise directly through retail, online and wholesale businesses. Its cable networks consist of ESPN, the Disney Channels and Freeform.

About Gray Television

Gray Television, Inc. is a television broadcast company. The Company owns and operates television stations and digital assets in various markets across the United States. As of February 21, 2017, the Company owned and/or operated television stations in 54 television markets broadcasting over 200 separate programming streams, including 37 affiliates of the CBS Network (CBS), 29 affiliates of the NBC Network (NBC), 20 affiliates of the ABC Network (ABC) and 15 affiliates of the FOX Network (FOX). In addition to a primary broadcast channel, each of its stations can also broadcast additional secondary digital channels within a market by utilizing the same bandwidth, but with different programming from the primary channel. The Company also broadcasts local news/weather channels in certain of its existing markets. Along with affiliations with ABC, CBS and FOX, the Company’s secondary channels are affiliated with various smaller networks and program services.

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