Critical Survey: Skydance (NYSE:SKYD) & TKO Group (NYSE:TKO)

Skydance (NYSE:SKYD) and TKO Group (NYSE:TKO) are both communication services companies, but which is the better investment? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, earnings, profitability, dividends, risk and institutional ownership.

Profitability

This table compares Skydance and TKO Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Skydance	-2.13%	4.11%	1.21%
TKO Group	4.33%	2.67%	1.49%

Earnings & Valuation

This table compares Skydance and TKO Group”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Skydance	$28.89 billion	0.36	-$621.00 million	$0.29	32.10
TKO Group	$4.74 billion	7.27	$195.40 million	$2.85	63.79

TKO Group has lower revenue, but higher earnings than Skydance. Skydance is trading at a lower price-to-earnings ratio than TKO Group, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Skydance and TKO Group, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Skydance	9	5	4	0	1.72
TKO Group	0	6	10	0	2.62

Skydance currently has a consensus price target of $5.78, suggesting a potential downside of 37.88%. TKO Group has a consensus price target of $237.50, suggesting a potential upside of 30.63%. Given TKO Group’s stronger consensus rating and higher probable upside, analysts plainly believe TKO Group is more favorable than Skydance.

Institutional and Insider Ownership

73.0% of Skydance shares are owned by institutional investors. Comparatively, 89.8% of TKO Group shares are owned by institutional investors. 0.4% of Skydance shares are owned by insiders. Comparatively, 64.3% of TKO Group shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Dividends

Skydance pays an annual dividend of $0.20 per share and has a dividend yield of 2.1%. TKO Group pays an annual dividend of $3.16 per share and has a dividend yield of 1.7%. Skydance pays out 69.0% of its earnings in the form of a dividend. TKO Group pays out 110.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Skydance is clearly the better dividend stock, given its higher yield and lower payout ratio.

Volatility & Risk

Skydance has a beta of 1.53, suggesting that its stock price is 53% more volatile than the S&P 500. Comparatively, TKO Group has a beta of 0.67, suggesting that its stock price is 33% less volatile than the S&P 500.

Summary

TKO Group beats Skydance on 11 of the 16 factors compared between the two stocks.

About Skydance

Paramount Global is a media and entertainment company which creates premium content and experiences for audiences. The company’s portfolio of consumer brands includes CBS, Showtime Networks, Paramount Pictures, Nickelodeon, MTV, Comedy Central, BET, Paramount , Pluto TV and Simon & Schuster, among others. Paramount Global, formerly known as ViacomCBS Inc., is based in NEW YORK.

About TKO Group

TKO Group Holdings, Inc. operates as a sports and entertainment company. The company produces and licenses live events, television programs, and long-form and short-form content, reality series, and other filmed entertainment on digital and linear channels and via pay-per-view. It is involved in the merchandising of video games, apparel, equipment, trading cards, memorabilia, digital goods, and toys, as well as sale of travel packages and tickets. In addition, the company engages in the corporate sponsorships and advertising business, which offers sale of in-venue and in-broadcast advertising assets, content product integration, and digital impressions. The company was incorporated in 2023 and is based in New York, New York. TKO Group Holdings, Inc. is a subsidiary of Endeavor Group Holdings, Inc.