Critical Review: Las Vegas Sands (NYSE:LVS) vs. Vail Resorts (NYSE:MTN)

Vail Resorts (NYSE:MTN) and Las Vegas Sands (NYSE:LVS) are both consumer discretionary companies, but which is the better business? We will contrast the two businesses based on the strength of their risk, valuation, profitability, earnings, analyst recommendations, institutional ownership and dividends.

Insider and Institutional Ownership

94.9% of Vail Resorts shares are owned by institutional investors. Comparatively, 39.2% of Las Vegas Sands shares are owned by institutional investors. 1.2% of Vail Resorts shares are owned by company insiders. Comparatively, 0.6% of Las Vegas Sands 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.

Analyst Ratings

This is a breakdown of current recommendations for Vail Resorts and Las Vegas Sands, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Vail Resorts	2	7	5	0	2.21
Las Vegas Sands	1	8	10	0	2.47

Vail Resorts presently has a consensus target price of $151.45, indicating a potential upside of 1.89%. Las Vegas Sands has a consensus target price of $61.88, indicating a potential upside of 35.14%. Given Las Vegas Sands’ stronger consensus rating and higher probable upside, analysts plainly believe Las Vegas Sands is more favorable than Vail Resorts.

Dividends

Vail Resorts pays an annual dividend of $8.88 per share and has a dividend yield of 6.0%. Las Vegas Sands pays an annual dividend of $1.20 per share and has a dividend yield of 2.6%. Vail Resorts pays out 201.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Las Vegas Sands pays out 46.7% of its earnings in the form of a dividend. Vail Resorts has increased its dividend for 3 consecutive years and Las Vegas Sands has increased its dividend for 2 consecutive years. Vail Resorts is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility and Risk

Vail Resorts has a beta of 0.7, suggesting that its share price is 30% less volatile than the S&P 500. Comparatively, Las Vegas Sands has a beta of 0.85, suggesting that its share price is 15% less volatile than the S&P 500.

Valuation & Earnings

This table compares Vail Resorts and Las Vegas Sands”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Vail Resorts	$2.96 billion	1.79	$280.00 million	$4.40	33.78
Las Vegas Sands	$13.02 billion	2.28	$1.63 billion	$2.57	17.82

Las Vegas Sands has higher revenue and earnings than Vail Resorts. Las Vegas Sands is trading at a lower price-to-earnings ratio than Vail Resorts, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Vail Resorts and Las Vegas Sands’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Vail Resorts	5.38%	21.88%	2.67%
Las Vegas Sands	12.59%	133.90%	9.99%

Summary

Las Vegas Sands beats Vail Resorts on 11 of the 17 factors compared between the two stocks.

About Vail Resorts

Vail Resorts, Inc., through its subsidiaries, operates mountain resorts and regional ski areas in the United States. It operates through three segments: Mountain, Lodging, and Real Estate. The Mountain segment operates 41 destination mountain resorts and regional ski areas. This segment is also involved in the ancillary activities, including ski school, dining, and retail/rental operations, as well as real estate brokerage activities. The Lodging segment owns and/or manages various luxury hotels and condominiums under the RockResorts brand; other lodging properties; various condominiums located in proximity to the company's mountain resorts; destination resorts; and golf courses, as well as offers resort ground transportation services. This segment operates owned and managed hotel and condominium units. The Real Estate segment owns, develops, and sells real estate properties. The company was founded in 1845 and is based in Broomfield, Colorado.

About Las Vegas Sands

Las Vegas Sands Corp., together with its subsidiaries, develops, owns, and operates integrated resorts in Macao and Singapore. It owns and operates The Venetian Macao Resort Hotel, the Londoner Macao, The Parisian Macao, The Plaza Macao and Four Seasons Hotel Macao, Cotai Strip, and the Sands Macao in Macao, the People’s Republic of China; and Marina Bay Sands in Singapore. The company’s integrated resorts feature accommodations, gaming, entertainment and retail malls, convention and exhibition facilities, celebrity chef restaurants, and other amenities. Las Vegas Sands Corp. was founded in 1988 and is based in Las Vegas, Nevada.