Red Rock Resorts (NASDAQ:RRR) versus Playtika (NASDAQ:PLTK) Critical Survey

Playtika (NASDAQ:PLTK) and Red Rock Resorts (NASDAQ:RRR) are both consumer discretionary companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, valuation, analyst recommendations, profitability, earnings, dividends and risk.

Risk & Volatility

Playtika has a beta of 0.84, suggesting that its share price is 16% less volatile than the S&P 500. Comparatively, Red Rock Resorts has a beta of 1.52, suggesting that its share price is 52% more volatile than the S&P 500.

Insider & Institutional Ownership

11.9% of Playtika shares are owned by institutional investors. Comparatively, 47.8% of Red Rock Resorts shares are owned by institutional investors. 5.1% of Playtika shares are owned by insiders. Comparatively, 53.8% of Red Rock Resorts shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares Playtika and Red Rock Resorts”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Playtika	$2.55 billion	0.61	$162.20 million	$0.24	17.13
Red Rock Resorts	$1.94 billion	3.39	$154.05 million	$3.14	19.76

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

Dividends

Playtika pays an annual dividend of $0.40 per share and has a dividend yield of 9.7%. Red Rock Resorts pays an annual dividend of $1.04 per share and has a dividend yield of 1.7%. Playtika pays out 166.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Red Rock Resorts pays out 33.1% of its earnings in the form of a dividend.

Analyst Recommendations

This is a summary of current ratings for Playtika and Red Rock Resorts, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Playtika	0	6	3	0	2.33
Red Rock Resorts	0	4	9	1	2.79

Playtika currently has a consensus price target of $6.00, suggesting a potential upside of 45.99%. Red Rock Resorts has a consensus price target of $65.08, suggesting a potential upside of 4.86%. Given Playtika’s higher probable upside, equities research analysts clearly believe Playtika is more favorable than Red Rock Resorts.

Profitability

This table compares Playtika and Red Rock Resorts’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Playtika	3.16%	-114.44%	3.23%
Red Rock Resorts	9.52%	59.86%	4.80%

Summary

Red Rock Resorts beats Playtika on 13 of the 17 factors compared between the two stocks.

About Playtika

Playtika Holding Corp., together with its subsidiaries, develops mobile games in the United States, Europe, Middle East, Africa, Asia pacific, and internationally. The company owns a portfolio of casual and social casino-themed games. It distributes its games to the end customer through various web and mobile platforms and direct-to-consumer platforms. Playtika Holding Corp. was founded in 2010 and is headquartered in Herzliya Pituach, Israel. Playtika Holding Corp. is a subsidiary of Playtika Holding UK II Limited.

About Red Rock Resorts

Red Rock Resorts, Inc., through its interest in Station Casinos LLC, develops and operates casino and entertainment properties in the United States. The company owns and operates gaming and entertainment facilities, including Durango Casino & Resort and smaller casinos in the Las Vegas regional market. The company was formerly known as Station Casinos Corp. and changed its name to Red Rock Resorts, Inc. in January 2016. Red Rock Resorts, Inc. was founded in 1976 and is based in Las Vegas, Nevada.