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

Dividends

Walt Disney Company (The) pays an annual dividend of $1.56 per share and has a dividend yield of 1.6%. Starz Acquisition does not pay a dividend. Walt Disney Company (The) pays out 27.6% of its earnings in the form of a dividend.

Earnings & Valuation

This table compares Walt Disney Company (The) and Starz Acquisition’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) $55.50 billion 2.74 $16.82 billion $5.66 17.42
Starz Acquisition N/A N/A N/A $1.79 19.51

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

Analyst Recommendations

This is a breakdown of recent recommendations for Walt Disney Company (The) and Starz Acquisition, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Walt Disney Company (The) 4 11 18 0 2.42
Starz Acquisition 0 0 1 0 3.00

Walt Disney Company (The) presently has a consensus price target of $114.12, indicating a potential upside of 15.74%. Starz Acquisition has a consensus price target of $36.00, indicating a potential upside of 3.06%. Given Walt Disney Company (The)’s higher probable upside, research analysts clearly believe Walt Disney Company (The) is more favorable than Starz Acquisition.

Volatility and Risk

Walt Disney Company (The) has a beta of 1.42, indicating that its stock price is 42% more volatile than the S&P 500. Comparatively, Starz Acquisition has a beta of 0.07, indicating that its stock price is 93% less volatile than the S&P 500.

Profitability

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

Net Margins Return on Equity Return on Assets
Walt Disney Company (The) 16.22% 19.69% 10.05%
Starz Acquisition -68.21% -14.75% -6.41%

Institutional & Insider Ownership

61.4% of Walt Disney Company (The) shares are owned by institutional investors. Comparatively, 80.2% of Starz Acquisition shares are owned by institutional investors. 0.4% of Walt Disney Company (The) shares are owned by insiders. Comparatively, 8.5% of Starz Acquisition shares are owned by 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

Walt Disney Company (The) beats Starz Acquisition on 9 of the 13 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 Starz Acquisition

Starz Acquisition LLC, formerly Starz, is an integrated media and entertainment company. The Company provides premium subscription video programming in the United States to cable operators, satellite television providers, telecommunications companies and online video providers. The Company’s segments include Starz Networks and Starz Distribution. The Starz Networks segment provides premium subscription video programming to the United States multichannel video programming distributors (MVPDs), including cable operators (such as Comcast and Time Warner Cable), satellite television providers (such as DIRECTV and DISH Network) and telecommunications companies (such as AT&T and Verizon). The Starz Distribution segment includes the operations of its Anchor Bay Entertainment, Starz Digital and Starz Worldwide Distribution businesses. It also develops, produces and acquires entertainment content and distributes this content to consumers in the United States and throughout the world.

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