Reviewing Reborn Coffee (NASDAQ:REBN) and Bally’s (NYSE:BALY)

Bally’s (NYSE:BALY) and Reborn Coffee (NASDAQ:REBN) are both small-cap consumer discretionary companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, valuation, dividends, profitability, analyst recommendations, institutional ownership and risk.

Valuation & Earnings

This table compares Bally’s and Reborn Coffee”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Bally’s	$2.45 billion	0.29	-$701.10 million	($6.80)	-2.05
Reborn Coffee	$16.10 million	0.66	-$9.14 million	($0.44)	-2.82

Reborn Coffee has lower revenue, but higher earnings than Bally’s. Reborn Coffee is trading at a lower price-to-earnings ratio than Bally’s, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

70.4% of Bally’s shares are held by institutional investors. Comparatively, 1.8% of Reborn Coffee shares are held by institutional investors. 69.3% of Bally’s shares are held by insiders. Comparatively, 29.3% of Reborn Coffee shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Bally’s and Reborn Coffee, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Bally’s	2	3	0	0	1.60
Reborn Coffee	1	0	0	0	1.00

Bally’s currently has a consensus target price of $11.75, indicating a potential downside of 15.67%. Given Bally’s’ stronger consensus rating and higher possible upside, analysts clearly believe Bally’s is more favorable than Reborn Coffee.

Profitability

This table compares Bally’s and Reborn Coffee’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Bally’s	-25.83%	-40.97%	-7.66%
Reborn Coffee	-37.56%	-354.56%	-42.27%

Risk & Volatility

Bally’s has a beta of 1.76, indicating that its stock price is 76% more volatile than the S&P 500. Comparatively, Reborn Coffee has a beta of 1.95, indicating that its stock price is 95% more volatile than the S&P 500.

Summary

Bally’s beats Reborn Coffee on 9 of the 13 factors compared between the two stocks.

About Bally’s

Bally’s Corp. is a global casino-entertainment company with a portfolio of casinos and resorts and online gaming businesses. It operates through the following segments: Casinos & Resorts, International Interactive, and North America Interactive. The Casinos & Resorts segment consists of the company’s casino and resort properties, a horse racetrack, and a golf course. The International Interactive segment includes the European and Asian operations of Gamesys, a business-to-consumer iCasino operator. The North America Interactive segment covers a portfolio of sports betting, iGaming, and free-to-play gaming brands such as Bally’s Interactive, SportCaller, and Live at the Bike, and the North American operations of Gamesys. The company was founded on March 1, 2004 and is headquartered in Providence, RI.

About Reborn Coffee

Reborn Coffee, Inc., through its subsidiaries, operates and franchises retail locations, kiosks, and cafes that focus on serving specialty-roasted coffee in California. It purchases, roasts, and sells coffee, tea and other beverages, and various food items. It offers products in various form factors, such as whole bean roasted coffee bags, single-serve drip bags, and pour over packs. The company also offers its products online. Reborn Coffee, Inc. was founded in 2014 and is headquartered in Brea, California.