Analyzing Churchill Downs (NASDAQ:CHDN) & GameSquare (NASDAQ:GAME)

Churchill Downs (NASDAQ:CHDN) and GameSquare (NASDAQ:GAME) are both consumer discretionary companies, but which is the superior stock? We will compare the two businesses based on the strength of their valuation, institutional ownership, analyst recommendations, profitability, dividends, risk and earnings.

Volatility and Risk

Churchill Downs has a beta of 0.68, indicating that its share price is 32% less volatile than the S&P 500. Comparatively, GameSquare has a beta of 1.52, indicating that its share price is 52% more volatile than the S&P 500.

Insider and Institutional Ownership

82.6% of Churchill Downs shares are held by institutional investors. Comparatively, 64.3% of GameSquare shares are held by institutional investors. 5.9% of Churchill Downs shares are held by insiders. Comparatively, 5.2% of GameSquare shares are held 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.

Analyst Recommendations

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

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Churchill Downs	1	0	11	0	2.83
GameSquare	2	0	0	0	1.00

Churchill Downs presently has a consensus target price of $139.00, suggesting a potential upside of 54.07%. Given Churchill Downs’ stronger consensus rating and higher probable upside, equities research analysts clearly believe Churchill Downs is more favorable than GameSquare.

Profitability

This table compares Churchill Downs and GameSquare’s 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%
GameSquare	-87.56%	-42.48%	-15.43%

Earnings & Valuation

This table compares Churchill Downs and GameSquare”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Churchill Downs	$2.93 billion	2.15	$383.00 million	$5.40	16.71
GameSquare	$45.00 million	0.84	-$40.10 million	($0.59)	-0.68

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

Summary

Churchill Downs beats GameSquare on 13 of the 14 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 GameSquare

GameSquare Holdings, Inc. operates as a vertically integrated digital media, entertainment, and technology company. Its platform to connect with gaming and youth culture audiences. The company’s end-to-end platform includes Code Red Esports Ltd., an esports talent agency; GCN, a digital media company focusing on the gaming and esports audience; Zoned, a gaming and lifestyle marketing agency; Complexity Gaming, a esports organization operating; Fourth Frame Studios, a creative production studio; and Mission Supply, a merchandise and consumer products business; Frankly Media, programmatic advertising, Stream Hatchet, live streaming analytics, and Sideqik a social influencer marketing platform. The company also engages in providing marketing and creative services, offering leading data and analytics solutions. The company was formerly known as Engine Gaming & Media, Inc. GameSquare Holdings, Inc. is headquartered in Frisco, Texas.