Genius Sports (NYSE:GENI – Get Free Report) and PENN Entertainment (NASDAQ:PENN – Get Free Report) are both consumer discretionary companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, risk, earnings, analyst recommendations, dividends, institutional ownership and profitability.
Risk and Volatility
Genius Sports has a beta of 1.95, meaning that its share price is 95% more volatile than the S&P 500. Comparatively, PENN Entertainment has a beta of 1.4, meaning that its share price is 40% more volatile than the S&P 500.
Insider & Institutional Ownership
81.9% of Genius Sports shares are held by institutional investors. Comparatively, 91.7% of PENN Entertainment shares are held by institutional investors. 16.6% of Genius Sports shares are held by insiders. Comparatively, 3.2% of PENN Entertainment shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Profitability
This table compares Genius Sports and PENN Entertainment’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Genius Sports | -18.85% | -22.14% | -10.93% |
| PENN Entertainment | -0.13% | 7.05% | 0.91% |
Valuation & Earnings
This table compares Genius Sports and PENN Entertainment”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Genius Sports | $669.49 million | 2.20 | -$111.58 million | ($0.68) | -8.78 |
| PENN Entertainment | $6.96 billion | 0.34 | -$843.10 million | ($6.36) | -2.74 |
Genius Sports has higher earnings, but lower revenue than PENN Entertainment. Genius Sports is trading at a lower price-to-earnings ratio than PENN Entertainment, indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a breakdown of current ratings and target prices for Genius Sports and PENN Entertainment, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Genius Sports | 2 | 2 | 14 | 1 | 2.74 |
| PENN Entertainment | 1 | 5 | 14 | 1 | 2.71 |
Genius Sports presently has a consensus price target of $10.76, suggesting a potential upside of 80.25%. PENN Entertainment has a consensus price target of $23.56, suggesting a potential upside of 35.14%. Given Genius Sports’ stronger consensus rating and higher possible upside, analysts clearly believe Genius Sports is more favorable than PENN Entertainment.
Summary
Genius Sports beats PENN Entertainment on 8 of the 13 factors compared between the two stocks.
About Genius Sports
Genius Sports Limited engages in the development and sale of technology-led products and services to the sports, sports betting, and sports media industries. It offers technology infrastructure for the collection, integration, and distribution of live data of sports leagues; streaming solutions comprising technology, automatic production, and distribution for sports to commercialize video footage of their games; and end-to-end integrity services to sports leagues, such as full-time active monitoring technology, which uses mathematical algorithms to identify and flag suspicious betting activity in global betting markets, as well as a full suite of online and offline educational and consultancy services. The company also provides live sports data collection; pre-game and in-game odds feeds; risk management services, including customer profiling, monitoring of incoming bets, automated acceptance and rejection of bets, and limit setting; live streaming services; creation, delivery, and optimization of digital marketing campaigns, such as data-driven personalized ad creative; and fan engagement widgets for digital publishers that offer live game statistics and betting-related content. The company was founded in 2001 and is headquartered in London, the United Kingdom.
About PENN Entertainment
PENN Entertainment, Inc., together with its subsidiaries, provides integrated entertainment, sports content, and casino gaming experiences. The company operates through five segments: Northeast, South, West, Midwest, and Interactive. It operates online sports betting in various jurisdictions; and iCasino under Hollywood Casino, L'Auberge, ESPN BET, and theScore Bet Sportsbook and Casino brands. The company's portfolio also includes PENN Play, customer loyalty program, which offers a set of rewards and experiences for business channels. In addition, it owns various trademarks and service marks, including Ameristar, Argosy, Boomtown, Hollywood Casino, Hollywood Gaming, L'Auberge, PENN Play, theScore, theScore Bet, theScore esports, and M Resort. The company was formerly known as Penn National Gaming, Inc. and changed its name to PENN Entertainment, Inc. in August 2022. PENN Entertainment, Inc. was founded in 1972 and is based in Wyomissing, Pennsylvania.
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