Financial Survey: Melco Resorts & Entertainment (MLCO) vs. Its Peers

Melco Resorts & Entertainment (NASDAQ:MLCO) is one of 383 publicly-traded companies in the “Hotels, Restaurants & Leisure” industry, but how does it contrast to its peers? We will compare Melco Resorts & Entertainment to related companies based on the strength of its profitability, analyst recommendations, institutional ownership, dividends, valuation, earnings and risk.

Institutional and Insider Ownership

39.6% of Melco Resorts & Entertainment shares are held by institutional investors. Comparatively, 48.6% of shares of all “Hotels, Restaurants & Leisure” companies are held by institutional investors. 57.1% of Melco Resorts & Entertainment shares are held by company insiders. Comparatively, 22.0% of shares of all “Hotels, Restaurants & Leisure” companies are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares Melco Resorts & Entertainment and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Melco Resorts & Entertainment	3.15%	-14.47%	2.24%
Melco Resorts & Entertainment Competitors	8.44%	-42.19%	1.97%

Volatility and Risk

Melco Resorts & Entertainment has a beta of 0.49, indicating that its stock price is 51% less volatile than the S&P 500. Comparatively, Melco Resorts & Entertainment’s peers have a beta of 1.42, indicating that their average stock price is 42% more volatile than the S&P 500.

Valuation and Earnings

This table compares Melco Resorts & Entertainment and its peers top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Melco Resorts & Entertainment	$5.16 billion	$185.04 million	10.44
Melco Resorts & Entertainment Competitors	$3.43 billion	$250.18 million	-160.79

Melco Resorts & Entertainment has higher revenue, but lower earnings than its peers. Melco Resorts & Entertainment is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Analyst Ratings

This is a summary of recent recommendations and price targets for Melco Resorts & Entertainment and its peers, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Melco Resorts & Entertainment	3	4	2	0	1.89
Melco Resorts & Entertainment Competitors	3839	17331	25651	910	2.50

Melco Resorts & Entertainment currently has a consensus price target of $5.72, indicating a potential upside of 33.76%. As a group, “Hotels, Restaurants & Leisure” companies have a potential upside of 52.97%. Given Melco Resorts & Entertainment’s peers stronger consensus rating and higher probable upside, analysts clearly believe Melco Resorts & Entertainment has less favorable growth aspects than its peers.

Summary

Melco Resorts & Entertainment peers beat Melco Resorts & Entertainment on 8 of the 13 factors compared.

Melco Resorts & Entertainment Company Profile

Melco Resorts & Entertainment develops, owns and operates integrated resorts that combine casino gaming with hotels, dining, retail, entertainment and convention facilities. Its properties include City of Dreams, Studio City and Altira Macau, as well as City of Dreams Manila in the Philippines. The company has also developed and operated resort and casino facilities in Cyprus, extending its business beyond its core Macau and Philippine markets. Its offerings are designed to serve both gaming customers and visitors seeking hospitality and entertainment experiences.