Churchill Downs, (NASDAQ: CHDN) and Eldorado Resorts (NASDAQ:ERI) are both consumer discretionary companies, but which is the superior stock? We will compare the two companies based on the strength of their valuation, earnings, risk, dividends, institutional ownership, analyst recommendations and profitability.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Churchill Downs, and Eldorado Resorts, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Churchill Downs, 0 3 1 0 2.25
Eldorado Resorts 0 0 2 0 3.00

Churchill Downs, presently has a consensus target price of $183.33, indicating a potential downside of 4.64%. Eldorado Resorts has a consensus target price of $25.00, indicating a potential upside of 10.13%. Given Eldorado Resorts’ stronger consensus rating and higher probable upside, analysts clearly believe Eldorado Resorts is more favorable than Churchill Downs,.

Dividends

Churchill Downs, pays an annual dividend of $1.32 per share and has a dividend yield of 0.7%. Eldorado Resorts does not pay a dividend. Churchill Downs, pays out 17.9% of its earnings in the form of a dividend.

Earnings & Valuation

This table compares Churchill Downs, and Eldorado Resorts’ gross revenue, earnings per share 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 26.09
Eldorado Resorts N/A N/A N/A ($0.45) -50.44

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

Institutional & Insider Ownership

73.8% of Churchill Downs, shares are held by institutional investors. Comparatively, 69.4% of Eldorado Resorts shares are held by institutional investors. 18.4% of Churchill Downs, shares are held by company insiders. Comparatively, 1.1% of Eldorado Resorts shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Churchill Downs, and Eldorado Resorts’ 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%
Eldorado Resorts -3.38% -8.03% -1.78%

Volatility and Risk

Churchill Downs, has a beta of 0.88, meaning that its stock price is 12% less volatile than the S&P 500. Comparatively, Eldorado Resorts has a beta of 0.99, meaning that its stock price is 1% less volatile than the S&P 500.

Summary

Churchill Downs, beats Eldorado Resorts on 8 of the 13 factors compared between the two stocks.

About Churchill Downs,

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).

About Eldorado Resorts

Eldorado Resorts, Inc. is a gaming and hospitality company that owns and operates gaming facilities located in Ohio, Louisiana, Nevada, Pennsylvania and West Virginia. The Company’s segments are Nevada, Louisiana, Eastern and Corporate. As of May 1, 2017, the Company owned and operated approximately 503,000 square feet of casino space with approximately 20,000 slot machines and video lottery terminals (VLTs), over 550 table and poker games, 45 restaurants and 6,500 hotel rooms. As of December 31, 2016, the Company owned and operated various properties, including Eldorado Resort Casino Reno (Eldorado Reno), Silver Legacy Resort Casino (Silver Legacy), Circus Circus Reno (Circus Reno), Eldorado Resort Casino Shreveport (Eldorado Shreveport), Mountaineer Casino, Racetrack & Resort (Mountaineer), Presque Isle Downs & Casino (Presque Isle Downs), and Eldorado Gaming Scioto Downs (Scioto Downs).

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