Analyzing The Madison Square Garden (MSG) and Golden Entertainment (GDEN)

The Madison Square Garden (NYSE: MSG) and Golden Entertainment (NASDAQ:GDEN) are both consumer discretionary companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, analyst recommendations, valuation, profitability, risk, dividends and earnings.

Valuation and Earnings

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This table compares The Madison Square Garden and Golden Entertainment’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
The Madison Square Garden $1.32 billion 4.37 -$72.72 million ($1.11) -220.41
Golden Entertainment $509.81 million 1.40 $2.17 million $0.34 76.74

Golden Entertainment has lower revenue, but higher earnings than The Madison Square Garden. The Madison Square Garden is trading at a lower price-to-earnings ratio than Golden Entertainment, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

The Madison Square Garden has a beta of 0.46, indicating that its share price is 54% less volatile than the S&P 500. Comparatively, Golden Entertainment has a beta of 0.52, indicating that its share price is 48% less volatile than the S&P 500.

Profitability

This table compares The Madison Square Garden and Golden Entertainment’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
The Madison Square Garden 5.21% -1.00% -0.67%
Golden Entertainment 0.43% 1.86% 0.70%

Analyst Ratings

This is a summary of recent recommendations for The Madison Square Garden and Golden Entertainment, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
The Madison Square Garden 0 2 5 0 2.71
Golden Entertainment 0 1 3 0 2.75

The Madison Square Garden currently has a consensus target price of $222.00, suggesting a potential downside of 9.26%. Golden Entertainment has a consensus target price of $35.00, suggesting a potential upside of 34.15%. Given Golden Entertainment’s stronger consensus rating and higher probable upside, analysts plainly believe Golden Entertainment is more favorable than The Madison Square Garden.

Insider and Institutional Ownership

70.9% of The Madison Square Garden shares are owned by institutional investors. Comparatively, 39.2% of Golden Entertainment shares are owned by institutional investors. 18.6% of The Madison Square Garden shares are owned by insiders. Comparatively, 52.0% of Golden Entertainment shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

Golden Entertainment beats The Madison Square Garden on 8 of the 13 factors compared between the two stocks.

The Madison Square Garden Company Profile

The Madison Square Garden Company, through its subsidiaries, engages in sports and entertainment businesses in the United States. The company operates in two segments, MSG Sports and MSG Entertainment. The MSG Sports segment owns and operates professional sports franchises, as well as promotes, produces, and/or presents a range of other live sporting events, including professional boxing, college basketball, college hockey, professional bull riding, mixed martial arts, esports, tennis, and college wrestling. The MSG Entertainment segment presents or hosts live entertainment events comprising concerts, family shows, performing arts, and special events, as well as creates, produces, and/or presents live productions in its venues. The company also operates 24 entertainment dining and nightlife venues in New York City, Las Vegas, and Los Angeles, as well as in Sydney, Australia, primarily under the Tao, Marquee, Lavo, Avenue, The Stanton Social, Beauty & Essex, and Vandal brands; and manages the food and beverage operations at the Dream Downtown and Dream Midtown hotels in New York City. The Madison Square Garden Company was founded in 1879 and is based in New York, New York.

Golden Entertainment Company Profile

Golden Entertainment, Inc. is a group of gaming companies. The Company focuses on distributed gaming, including tavern gaming, and casino and resort operations. It operates through two segments: Distributed Gaming and Casinos. Its Distributed Gaming segment involves the installation, maintenance and operation of gaming and amusement devices in certain strategic, high-traffic, non-casino locations (such as grocery stores, convenience stores, restaurants, bars, taverns, saloons and liquor stores) in Nevada and Montana, and the operation of traditional, branded taverns targeting local patrons, primarily in the greater Las Vegas, Nevada metropolitan area. As of October 23, 2017, its distributed gaming operations consisted of approximately 16,000 gaming devices in approximately 960 locations. Its Casinos segment consists of the Rocky Gap Casino Resort in Flintstone, Maryland and three casinos in Pahrump, Nevada: Pahrump Nugget Hotel Casino, Gold Town Casino and Lakeside Casino & RV Park.

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