DraftKings (NASDAQ:DKNG – Get Free Report) and MGM Resorts International (NYSE:MGM – Get Free Report) are both consumer discretionary companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, valuation, profitability, earnings, dividends, analyst recommendations and institutional ownership.
Insider & Institutional Ownership
37.7% of DraftKings shares are owned by institutional investors. Comparatively, 68.1% of MGM Resorts International shares are owned by institutional investors. 47.1% of DraftKings shares are owned by company insiders. Comparatively, 3.1% of MGM Resorts International shares are owned by company 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.
Profitability
This table compares DraftKings and MGM Resorts International’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| DraftKings | 0.06% | 5.36% | 0.96% |
| MGM Resorts International | 1.17% | 26.04% | 2.19% |
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| DraftKings | 2 | 5 | 24 | 0 | 2.71 |
| MGM Resorts International | 4 | 7 | 8 | 1 | 2.30 |
DraftKings presently has a consensus target price of $36.76, indicating a potential upside of 53.92%. MGM Resorts International has a consensus target price of $41.94, indicating a potential upside of 16.70%. Given DraftKings’ stronger consensus rating and higher possible upside, analysts plainly believe DraftKings is more favorable than MGM Resorts International.
Earnings and Valuation
This table compares DraftKings and MGM Resorts International”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| DraftKings | $6.05 billion | 1.94 | $3.71 million | ($0.04) | -597.15 |
| MGM Resorts International | $17.54 billion | 0.52 | $205.86 million | $0.75 | 47.91 |
MGM Resorts International has higher revenue and earnings than DraftKings. DraftKings is trading at a lower price-to-earnings ratio than MGM Resorts International, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
DraftKings has a beta of 1.67, meaning that its share price is 67% more volatile than the S&P 500. Comparatively, MGM Resorts International has a beta of 1.38, meaning that its share price is 38% more volatile than the S&P 500.
Summary
MGM Resorts International beats DraftKings on 9 of the 15 factors compared between the two stocks.
About DraftKings
DraftKings Inc. operates as a digital sports entertainment and gaming company in the United States and internationally. It provides online sports betting and casino, daily fantasy sports, media, and other consumer products, as well as retails sportsbooks. The company also engages in the design and development of sports betting and casino gaming software for online and retail sportsbooks, and iGaming operators. In addition, it offers DraftKings marketplace, a digital collectibles ecosystem designed for mainstream accessibility that offers curated NFT drops and supports secondary-market transactions. The company is headquartered in Boston, Massachusetts.
About MGM Resorts International
MGM Resorts International, through its subsidiaries, owns and operates casino, hotel, and entertainment resorts in the United States and internationally. The company operates through three segments: Las Vegas Strip Resorts, Regional Operations, and MGM China. Its casino resorts offer gaming, hotel, convention, dining, entertainment, retail, and other resort amenities. The company's casino operations include slots and table games, as well as online sports betting and iGaming through BetMGM. Its customers include premium gaming customers; leisure and wholesale travel customers; business travelers; and group customers, including conventions, trade associations, and small meetings. The company was formerly known as MGM MIRAGE and changed its name to MGM Resorts International in June 2010. MGM Resorts International was incorporated in 1986 and is based in Las Vegas, Nevada.
Receive News & Ratings for DraftKings Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for DraftKings and related companies with MarketBeat.com's FREE daily email newsletter.
