Churchill Downs, (NASDAQ: CHDN) and Boyd Gaming Corporation (NYSE:BYD) are both mid-cap consumer discretionary companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, earnings, valuation, analyst recommendations, risk, institutional ownership and dividends.

Dividends

Churchill Downs, pays an annual dividend of $1.32 per share and has a dividend yield of 0.7%. Boyd Gaming Corporation pays an annual dividend of $0.20 per share and has a dividend yield of 0.8%. Churchill Downs, pays out 17.9% of its earnings in the form of a dividend. Boyd Gaming Corporation pays out 5.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Boyd Gaming Corporation is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Ratings

This is a summary of recent ratings and price targets for Churchill Downs, and Boyd Gaming Corporation, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Churchill Downs, 0 3 1 0 2.25
Boyd Gaming Corporation 0 4 10 0 2.71

Churchill Downs, currently has a consensus target price of $183.33, indicating a potential downside of 4.46%. Boyd Gaming Corporation has a consensus target price of $26.79, indicating a potential upside of 2.27%. Given Boyd Gaming Corporation’s stronger consensus rating and higher probable upside, analysts plainly believe Boyd Gaming Corporation is more favorable than Churchill Downs,.

Profitability

This table compares Churchill Downs, and Boyd Gaming Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Churchill Downs, 9.22% 15.83% 4.69%
Boyd Gaming Corporation 19.15% 13.31% 2.79%

Valuation and Earnings

This table compares Churchill Downs, and Boyd Gaming Corporation’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Churchill Downs, $1.31 billion 2.36 $308.00 million $7.37 26.04
Boyd Gaming Corporation $2.29 billion 1.29 $525.83 million $3.81 6.87

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

Volatility & Risk

Churchill Downs, has a beta of 0.88, indicating that its share price is 12% less volatile than the S&P 500. Comparatively, Boyd Gaming Corporation has a beta of 1.93, indicating that its share price is 93% more volatile than the S&P 500.

Institutional and Insider Ownership

73.9% of Churchill Downs, shares are held by institutional investors. Comparatively, 71.1% of Boyd Gaming Corporation shares are held by institutional investors. 18.4% of Churchill Downs, shares are held by company insiders. Comparatively, 29.2% of Boyd Gaming Corporation shares are held by company 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

Boyd Gaming Corporation beats Churchill Downs, on 10 of the 16 factors compared between the two stocks.

Churchill Downs, Company Profile

Churchill Downs Incorporated is a racing, gaming and online entertainment company. The Company is engaged in brick-and-mortar casino gaming with approximately 9,030 gaming positions in seven states, and is a legal mobile and online platform for betting on horseracing in the United States. It operates through six segments: Racing, Casinos, TwinSpires, Big Fish Games, Other Investments and Corporate. Racing includes four racetracks: Churchill Downs Racetrack, Arlington International Race Course, Fair Grounds Race Course and Calder Race Course. Casinos is a provider of brick-and-mortar real-money casino gaming. TwinSpires operates mobile and online wagering business, which is a platform for betting on horseracing. Big Fish Games, Inc. is a producer and distributor of social casino, casual and mid-core free-to-play and premium paid games for personal computer (PC), Mac and mobile devices. Other Investments includes United Tote and Capital View Casino & Resort Joint Venture (Capital View).

Boyd Gaming Corporation Company Profile

Boyd Gaming Corporation is a multi-jurisdictional gaming company. The Company operated 24 wholly owned gaming entertainment properties in Nevada, Illinois, Indiana, Iowa, Kansas, Louisiana and Mississippi, as of December 31, 2016. It operates through three segments: Las Vegas Locals, Downtown Las Vegas, and Midwest and South. It owns and operates a travel agency and a captive insurance company that underwrites travel-related insurance, each located in Hawaii. The Company’s Las Vegas Locals segment includes properties, such as Gold Coast Hotel and Casino, The Orleans Hotel and Casino, and Sam’s Town Hotel and Gambling Hall. The Downtown Las Vegas segment includes three properties, such as California Hotel and Casino Fremont Hotel and Casino and Main Street Station Casino, Brewery and Hotel Street Station. Its Midwest and South segment’s properties include Par-A-Dice Hotel Casino, Diamond Jo Dubuque, Diamond Jo Worth, Kansas Star Casino, Amelia Belle Casino and Evangeline Downs.

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