Head to Head Review: MGM China (OTCMKTS:MCHVF) vs. Boyd Gaming (NYSE:BYD)

Boyd Gaming (NYSE:BYD) and MGM China (OTCMKTS:MCHVF) are both consumer cyclical companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, analyst recommendations, valuation, institutional ownership, dividends, earnings and risk.

Profitability

This table compares Boyd Gaming and MGM China’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Boyd Gaming	19.61%	41.56%	10.88%
MGM China	N/A	N/A	N/A

Analyst Ratings

This is a breakdown of current ratings and target prices for Boyd Gaming and MGM China, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Boyd Gaming	0	2	9	0	2.82
MGM China	1	0	1	0	2.00

Boyd Gaming currently has a consensus price target of $77.00, indicating a potential upside of 20.39%. Given Boyd Gaming’s stronger consensus rating and higher possible upside, research analysts clearly believe Boyd Gaming is more favorable than MGM China.

Valuation and Earnings

This table compares Boyd Gaming and MGM China’s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Boyd Gaming	$3.68 billion	1.74	$639.38 million	$6.91	9.26
MGM China	N/A	N/A	N/A	$1.55	0.77

Boyd Gaming has higher revenue and earnings than MGM China. MGM China is trading at a lower price-to-earnings ratio than Boyd Gaming, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

68.0% of Boyd Gaming shares are held by institutional investors. Comparatively, 9.1% of MGM China shares are held by institutional investors. 27.9% of Boyd Gaming shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Dividends

Boyd Gaming pays an annual dividend of $0.64 per share and has a dividend yield of 1.0%. MGM China pays an annual dividend of $0.49 per share and has a dividend yield of 41.2%. Boyd Gaming pays out 9.3% of its earnings in the form of a dividend. MGM China pays out 31.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Boyd Gaming has raised its dividend for 1 consecutive years.

Summary

Boyd Gaming beats MGM China on 13 of the 14 factors compared between the two stocks.

About Boyd Gaming

Boyd Gaming Corporation, together with its subsidiaries, operates as a multi-jurisdictional gaming company in Nevada, Illinois, Indiana, Iowa, Kansas, Louisiana, Mississippi, Missouri, Ohio, and Pennsylvania. It operates through three segments: Las Vegas Locals, Downtown Las Vegas, and Midwest & South. The company also engages in owning and operating a travel agency. The company was founded in 1975 and is headquartered in Las Vegas, Nevada.

About MGM China

MGM China Holdings Limited, an investment holding company, engages in the development, ownership, and operation of gaming and lodging resorts in the Greater China region. The company develops and operates casino games of chance and other casino games, and related hotel and resort facilities, as well as provides hotel management services; and develops integrated resorts in Macau. It owns and operates MGM Macau, an integrated resort that includes a casino with 926 slot machines and 294 gaming tables, multiple VIP, and private gaming areas; a hotel with 585 hotel rooms, suites, and villas; and amenities, including 8 restaurants, retail outlets, pool, and spa facilities, as well as a convention space. The company also owns MGM Cotai, a resort that consists of a casino with 934 slot machines and 258 gaming tables; a hotel with 1,418 hotel rooms, suites, and skylofts; 12 restaurants and bars; retail outlets; and a meeting space, as well as other non-gaming offerings. In addition, MGM China Holdings Limited is involved in the provision of outsourcing services, including information technology, accounting, human resources, hotel reservation, and convention consultation. The company was incorporated in 2010 and is headquartered in Macau. MGM China Holdings Limited is a subsidiary of MGM Resorts International Holdings, Ltd.