Churchill Downs (NASDAQ:CHDN) & Wynn Resorts (NASDAQ:WYNN) Critical Comparison

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

Insider and Institutional Ownership

82.6% of Churchill Downs shares are owned by institutional investors. Comparatively, 88.6% of Wynn Resorts shares are owned by institutional investors. 5.9% of Churchill Downs shares are owned by insiders. Comparatively, 0.9% of Wynn Resorts shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Churchill Downs	13.21%	43.50%	6.10%
Wynn Resorts	5.14%	-42.03%	3.53%

Analyst Recommendations

This is a summary of current ratings for Churchill Downs and Wynn Resorts, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Churchill Downs	1	0	11	0	2.83
Wynn Resorts	0	2	15	1	2.94

Churchill Downs presently has a consensus target price of $139.00, suggesting a potential upside of 67.33%. Wynn Resorts has a consensus target price of $140.00, suggesting a potential upside of 43.05%. Given Churchill Downs’ higher possible upside, equities analysts clearly believe Churchill Downs is more favorable than Wynn Resorts.

Volatility and Risk

Churchill Downs has a beta of 0.73, suggesting that its share price is 27% less volatile than the S&P 500. Comparatively, Wynn Resorts has a beta of 1.01, suggesting that its share price is 1% more volatile than the S&P 500.

Dividends

Churchill Downs pays an annual dividend of $0.44 per share and has a dividend yield of 0.5%. Wynn Resorts pays an annual dividend of $1.00 per share and has a dividend yield of 1.0%. Churchill Downs pays out 8.1% of its earnings in the form of a dividend. Wynn Resorts pays out 29.9% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Churchill Downs has increased its dividend for 14 consecutive years and Wynn Resorts has increased its dividend for 1 consecutive years.

Earnings and Valuation

This table compares Churchill Downs and Wynn Resorts”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Churchill Downs	$2.93 billion	1.98	$383.00 million	$5.40	15.38
Wynn Resorts	$7.14 billion	1.42	$327.33 million	$3.35	29.21

Churchill Downs has higher earnings, but lower revenue than Wynn Resorts. Churchill Downs is trading at a lower price-to-earnings ratio than Wynn Resorts, indicating that it is currently the more affordable of the two stocks.

Summary

Churchill Downs beats Wynn Resorts on 10 of the 18 factors compared between the two stocks.

About Churchill Downs

Churchill Downs Incorporated operates as a racing, online wagering, and gaming entertainment company in the United States. It operates through three segments: Live and Historical Racing, TwinSpires, and Gaming. The company operates pari-mutuel gaming entertainment venues; TwinSpires, an online wagering platform for horse racing, sports, and iGaming; retail sports books; casino gaming; and Terre Haute Casino Resort. It also offers streaming video of live horse races, replays, and an assortment of racing and handicapping information; and provides the Bloodstock Research Information Services platform for horse racing statistical data. In addition, the company manufactures and operates pari-mutuel wagering systems for racetracks, off-track betting facilities, and other pari-mutuel wagering businesses. Churchill Downs Incorporated was founded in 1875 and is headquartered in Louisville, Kentucky.

About Wynn Resorts

Wynn Resorts, Limited designs, develops, and operates integrated resorts. The company operates through four segments: Wynn Palace, Wynn Macau, Las Vegas Operations, and Encore Boston Harbor. The Wynn Palace segment operates private gaming salons and sky casinos; a luxury hotel tower with suites, and villas, including a health club, spa, salon, and pool; food and beverage outlets; retail space; meeting and convention space; and performance lake and floral art displays. The Wynn Macau segment operates casino space with private gaming salons, sky casinos, and a poker room; a luxury hotel tower, that include health clubs, spas, a salon, and a pool; food and beverage outlets; retail space; meeting and convention space; and Chinese zodiac-inspired ceiling attractions. The Las Vegas Operations segment operates casino space with private gaming salons, a sky casino, a poker room, and a race and sports book; a luxury hotel tower with suites, and villas, including swimming pools, private cabanas, full-service spas and salons, and a wedding chapel; food and beverage outlets; meeting and convention space; retail space; and theaters, nightclubs, a beach club. The Encore Boston Harbor segment operates casino space with gaming areas, and a poker room; a luxury hotel tower including a spa and salon; food and beverage outlets and a nightclub; retail space; meeting and convention space; and a waterfront park, floral displays, and water shuttle service. Wynn Resorts, Limited was incorporated in 2002 and is based in Las Vegas, Nevada.