Red Rock Resorts (NASDAQ:RRR) vs. Churchill Downs, (CHDN) Head to Head Analysis

Red Rock Resorts (NASDAQ: RRR) and Churchill Downs, (NASDAQ:CHDN) are both mid-cap consumer discretionary companies, but which is the superior business? We will contrast the two businesses based on the strength of their analyst recommendations, dividends, institutional ownership, earnings, profitability, valuation and risk.

Volatility and Risk

Red Rock Resorts has a beta of 0.51, indicating that its stock price is 49% less volatile than the S&P 500. Comparatively, Churchill Downs, has a beta of 0.88, indicating that its stock price is 12% less volatile than the S&P 500.

Dividends

Red Rock Resorts pays an annual dividend of $0.40 per share and has a dividend yield of 1.8%. Churchill Downs, pays an annual dividend of $1.32 per share and has a dividend yield of 0.7%. Red Rock Resorts pays out 83.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Churchill Downs, pays out 17.9% of its earnings in the form of a dividend.

Analyst Ratings

This is a breakdown of current ratings and price targets for Red Rock Resorts and Churchill Downs,, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Red Rock Resorts 0 2 10 0 2.83
Churchill Downs, 0 3 1 0 2.25

Red Rock Resorts presently has a consensus target price of $26.15, indicating a potential upside of 18.86%. Churchill Downs, has a consensus target price of $183.33, indicating a potential downside of 5.96%. Given Red Rock Resorts’ stronger consensus rating and higher probable upside, equities analysts clearly believe Red Rock Resorts is more favorable than Churchill Downs,.

Earnings and Valuation

This table compares Red Rock Resorts and Churchill Downs,’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Red Rock Resorts $1.56 billion 0.93 $495.60 million $0.48 45.83
Churchill Downs, $1.31 billion 2.40 $308.00 million $7.37 26.45

Red Rock Resorts has higher revenue and earnings than Churchill Downs,. Churchill Downs, 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.

Profitability

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

Net Margins Return on Equity Return on Assets
Red Rock Resorts 1.44% 14.05% 2.50%
Churchill Downs, 9.22% 15.83% 4.69%

Institutional and Insider Ownership

58.1% of Red Rock Resorts shares are owned by institutional investors. Comparatively, 74.5% of Churchill Downs, shares are owned by institutional investors. 40.9% of Red Rock Resorts shares are owned by insiders. Comparatively, 18.4% of Churchill Downs, shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Summary

Churchill Downs, beats Red Rock Resorts on 9 of the 16 factors compared between the two stocks.

About Red Rock Resorts

Red Rock Resorts, Inc. is a gaming, development and management company. The Company’s segments include Las Vegas operations, Native American management, and Corporate and other. The Las Vegas operations segment includes all of its Las Vegas area casino properties and the Native American management segment includes its Native American management arrangements. It provides gaming and entertainment for residents of the Las Vegas regional market and visitors. Its Las Vegas portfolio includes approximately 10 gaming and entertainment facilities and over 10 smaller casinos, offering approximately 20,300 slot machines, over 350 table games and approximately 4,750 hotel rooms. The Company offers a range of gaming and non-gaming entertainment options. It also controls over seven gaming-entitled development sites consisting of approximately 398 acres in Las Vegas and Reno, Nevada. The Company manages and owns interest in Station Casinos LLC, which is the provider of gaming and entertainment.

About Churchill Downs,

Churchill Downs Incorporated is a racing, gaming and online entertainment company. The Company is engaged in brick-and-mortar casino gaming with approximately 9,030 gaming positions in seven states, and is a legal mobile and online platform for betting on horseracing in the United States. It operates through six segments: Racing, Casinos, TwinSpires, Big Fish Games, Other Investments and Corporate. Racing includes four racetracks: Churchill Downs Racetrack, Arlington International Race Course, Fair Grounds Race Course and Calder Race Course. Casinos is a provider of brick-and-mortar real-money casino gaming. TwinSpires operates mobile and online wagering business, which is a platform for betting on horseracing. Big Fish Games, Inc. is a producer and distributor of social casino, casual and mid-core free-to-play and premium paid games for personal computer (PC), Mac and mobile devices. Other Investments includes United Tote and Capital View Casino & Resort Joint Venture (Capital View).

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