Penn National Gaming (NASDAQ: PENN) and Las Vegas Sands Corp. (NYSE:LVS) are both consumer discretionary companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, valuation, risk, profitability, analyst recommendations, earnings and institutional ownership.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Penn National Gaming and Las Vegas Sands Corp., as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Penn National Gaming 0 3 7 0 2.70
Las Vegas Sands Corp. 0 7 10 0 2.59

Penn National Gaming currently has a consensus price target of $20.67, indicating a potential downside of 3.38%. Las Vegas Sands Corp. has a consensus price target of $64.15, indicating a potential upside of 5.93%. Given Las Vegas Sands Corp.’s higher possible upside, analysts plainly believe Las Vegas Sands Corp. is more favorable than Penn National Gaming.

Valuation and Earnings

This table compares Penn National Gaming and Las Vegas Sands Corp.’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Penn National Gaming $3.05 billion 0.64 $818.63 million $0.80 26.74
Las Vegas Sands Corp. $12.29 billion 3.90 $4.37 billion $2.58 23.47

Las Vegas Sands Corp. has higher revenue and earnings than Penn National Gaming. Las Vegas Sands Corp. is trading at a lower price-to-earnings ratio than Penn National Gaming, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Penn National Gaming and Las Vegas Sands Corp.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Penn National Gaming 2.39% -16.72% 1.79%
Las Vegas Sands Corp. 16.66% 29.91% 10.65%

Risk and Volatility

Penn National Gaming has a beta of 1.01, suggesting that its stock price is 1% more volatile than the S&P 500. Comparatively, Las Vegas Sands Corp. has a beta of 1.81, suggesting that its stock price is 81% more volatile than the S&P 500.

Insider and Institutional Ownership

95.3% of Penn National Gaming shares are owned by institutional investors. Comparatively, 38.0% of Las Vegas Sands Corp. shares are owned by institutional investors. 11.1% of Penn National Gaming shares are owned by company insiders. Comparatively, 10.1% of Las Vegas Sands Corp. shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Dividends

Las Vegas Sands Corp. pays an annual dividend of $2.92 per share and has a dividend yield of 4.8%. Penn National Gaming does not pay a dividend. Las Vegas Sands Corp. pays out 113.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Penn National Gaming has increased its dividend for 4 consecutive years.

Summary

Las Vegas Sands Corp. beats Penn National Gaming on 11 of the 17 factors compared between the two stocks.

Penn National Gaming Company Profile

Penn National Gaming, Inc. (Penn) is an owner and manager of gaming and racing facilities, and video gaming terminal operations with a focus on slot machine entertainment. The Company operates through three segments: Northeast, South/West and Midwest. The Northeast segment consists of various properties, including Hollywood Casino at Charles Town Races, Hollywood Casino Bangor, Hollywood Casino at Penn National Race Course and Hollywood Casino Toledo. The South/West segment consists of various properties, such as Zia Park Casino, Hollywood Casino Tunica, Hollywood Casino Gulf Coast, Boomtown Biloxi, M Resort and Tropicana Las Vegas. The Midwest segment consists of various properties, Hollywood Casino Aurora, Hollywood Casino Joliet, Argosy Casino Alton, Argosy Casino Riverside and Hollywood Casino Lawrenceburg. The Other category consists of the Company’s standalone racing operations, including Rosecroft Raceway and Sanford-Orlando Kennel Club.

Las Vegas Sands Corp. Company Profile

Las Vegas Sands Corp. is a developer of destination properties (integrated resorts) that feature accommodations, gaming, entertainment and retail, convention and exhibition facilities, celebrity chef restaurants and other amenities. The Company owns and operates integrated resorts in Asia and the United States. The Company’s principal operating and developmental activities occur in three geographic areas: Macao, Singapore and the United States. In Macao, the Company’s segments include The Venetian Macao; Sands Cotai Central; The Parisian Macao; Four Seasons Macao; Sands Macao, and Other Asia (comprises the Company’s ferry operations and various other operations). In Singapore, the Company’s segments include Marina Bay Sands. In the United States, the Company’s segments include Las Vegas Operating Properties and Sands Bethlehem. The Company also offers players club loyalty programs at its properties, which provides access to rewards, privileges and members-only events.

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