Vail Resorts (NYSE:MTN) & Brinker International (NYSE:EAT) Critical Analysis

Vail Resorts (NYSE:MTN) and Brinker International (NYSE:EAT) are both mid-cap consumer discretionary 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 Vail Resorts and Brinker International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Vail Resorts	5.20%	22.82%	2.61%
Brinker International	8.39%	122.35%	17.42%

Institutional and Insider Ownership

94.9% of Vail Resorts shares are owned by institutional investors. 1.2% of Vail Resorts shares are owned by insiders. Comparatively, 1.2% of Brinker International shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Vail Resorts and Brinker International, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Vail Resorts	3	7	5	0	2.13
Brinker International	0	5	17	2	2.88

Vail Resorts currently has a consensus price target of $150.00, suggesting a potential downside of 1.65%. Brinker International has a consensus price target of $243.38, suggesting a potential upside of 20.46%. Given Brinker International’s stronger consensus rating and higher probable upside, analysts plainly believe Brinker International is more favorable than Vail Resorts.

Earnings & Valuation

This table compares Vail Resorts and Brinker International”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Vail Resorts	$2.84 billion	1.91	$147.54 million	$4.14	36.84
Brinker International	$5.81 billion	1.45	$487.00 million	$10.89	18.55

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

Risk & Volatility

Vail Resorts has a beta of 0.76, indicating that its share price is 24% less volatile than the S&P 500. Comparatively, Brinker International has a beta of 1.25, indicating that its share price is 25% more volatile than the S&P 500.

Summary

Brinker International beats Vail Resorts on 11 of the 15 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 Brinker International

Brinker International, Inc., together with its subsidiaries, engages in the ownership, development, operation, and franchising of casual dining restaurants in the United States and internationally. It operates and franchises Chili's Grill & Bar and Maggiano's Little Italy restaurant brands. The company also operates virtual brands, It's Just Wings. Brinker International, Inc. was founded in 1975 and is headquartered in Dallas, Texas.