Century Casinos (NASDAQ:CNTY) and Pinnacle Entertainment (NASDAQ:PNK) are both small-cap consumer discretionary companies, but which is the better investment? We will compare the two businesses based on the strength of their institutional ownership, profitability, analyst recommendations, dividends, valuation, earnings and risk.

Analyst Ratings

This is a summary of recent ratings for Century Casinos and Pinnacle Entertainment, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Century Casinos 0 0 1 0 3.00
Pinnacle Entertainment 0 6 3 0 2.33

Century Casinos currently has a consensus target price of $13.00, suggesting a potential upside of 75.20%. Pinnacle Entertainment has a consensus target price of $31.00, suggesting a potential downside of 7.13%. Given Century Casinos’ stronger consensus rating and higher possible upside, equities research analysts clearly believe Century Casinos is more favorable than Pinnacle Entertainment.

Profitability

This table compares Century Casinos and Pinnacle Entertainment’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Century Casinos 2.20% 5.01% 3.40%
Pinnacle Entertainment 3.16% -24.61% 1.97%

Volatility and Risk

Century Casinos has a beta of 0.21, meaning that its stock price is 79% less volatile than the S&P 500. Comparatively, Pinnacle Entertainment has a beta of 1.49, meaning that its stock price is 49% more volatile than the S&P 500.

Institutional and Insider Ownership

78.7% of Century Casinos shares are held by institutional investors. Comparatively, 87.1% of Pinnacle Entertainment shares are held by institutional investors. 12.7% of Century Casinos shares are held by company insiders. Comparatively, 10.3% of Pinnacle Entertainment shares are held by company 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.

Valuation & Earnings

This table compares Century Casinos and Pinnacle Entertainment’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Century Casinos $154.07 million 1.42 $6.25 million $0.45 16.49
Pinnacle Entertainment $2.56 billion 0.77 $63.10 million $1.02 32.73

Pinnacle Entertainment has higher revenue and earnings than Century Casinos. Century Casinos is trading at a lower price-to-earnings ratio than Pinnacle Entertainment, indicating that it is currently the more affordable of the two stocks.

Summary

Pinnacle Entertainment beats Century Casinos on 8 of the 14 factors compared between the two stocks.

Century Casinos Company Profile

Century Casinos, Inc. operates as a casino entertainment company worldwide. The company develops and operates gaming establishments, as well as related lodging, restaurant, horse racing, and entertainment facilities. It owns and operates casinos in North America and Poland; a racetrack and entertainment center in Canada; and pari-mutuel off-track betting network in southern Alberta, Canada. The company also manages cruise ship-based casinos; and provides gaming services in Argentina. As of March 9, 2018, it operated 14 ship-based casinos. The company was founded in 1992 and is based in Colorado Springs, Colorado.

Pinnacle Entertainment Company Profile

Pinnacle Entertainment, Inc. owns, develops, and operates casinos and related hospitality and entertainment facilities in the United States. It operates through Midwest, South, and West segments. As of February 28, 2018, the company owned and operated 16 gaming entertainment businesses located in Colorado, Indiana, Iowa, Louisiana, Mississippi, Missouri, Nevada, Ohio, and Pennsylvania. It also holds interest in the racing license owner, as well as a management contract, for Retama Park Racetrack outside of San Antonio, Texas. In addition, the company owns and operates a live and televised poker tournament series under the Heartland Poker Tour name. The company was formerly known as Hollywood Park, Inc. and changed its name to Pinnacle Entertainment, Inc. in February 2000. Pinnacle Entertainment, Inc. was founded in 1938 and is headquartered in Las Vegas, Nevada.

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