Reviewing Golden Entertainment (NASDAQ:GDEN) & Electronic Arts (NASDAQ:EA)

Golden Entertainment (NASDAQ:GDEN) and Electronic Arts (NASDAQ:EA) are both consumer discretionary companies, but which is the better business? We will compare the two businesses based on the strength of their risk, analyst recommendations, dividends, institutional ownership, profitability, valuation and earnings.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Golden Entertainment and Electronic Arts, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Golden Entertainment	0	2	5	0	2.71
Electronic Arts	0	15	11	2	2.54

Golden Entertainment presently has a consensus price target of $36.00, suggesting a potential upside of 42.74%. Electronic Arts has a consensus price target of $166.3462, suggesting a potential downside of 0.77%. Given Golden Entertainment’s stronger consensus rating and higher probable upside, analysts clearly believe Golden Entertainment is more favorable than Electronic Arts.

Dividends

Golden Entertainment pays an annual dividend of $1.00 per share and has a dividend yield of 4.0%. Electronic Arts pays an annual dividend of $0.76 per share and has a dividend yield of 0.5%. Golden Entertainment pays out 185.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Electronic Arts pays out 19.0% of its earnings in the form of a dividend.

Volatility & Risk

Golden Entertainment has a beta of 1.83, indicating that its share price is 83% more volatile than the S&P 500. Comparatively, Electronic Arts has a beta of 0.72, indicating that its share price is 28% less volatile than the S&P 500.

Earnings and Valuation

This table compares Golden Entertainment and Electronic Arts”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Golden Entertainment	$666.82 million	1.00	$50.73 million	$0.54	46.70
Electronic Arts	$7.46 billion	5.62	$1.12 billion	$3.99	42.02

Electronic Arts has higher revenue and earnings than Golden Entertainment. Electronic Arts is trading at a lower price-to-earnings ratio than Golden Entertainment, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Golden Entertainment and Electronic Arts’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Golden Entertainment	2.35%	3.16%	1.41%
Electronic Arts	13.94%	18.43%	9.93%

Insider and Institutional Ownership

70.7% of Golden Entertainment shares are owned by institutional investors. Comparatively, 90.2% of Electronic Arts shares are owned by institutional investors. 29.1% of Golden Entertainment shares are owned by insiders. Comparatively, 0.2% of Electronic Arts shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Summary

Electronic Arts beats Golden Entertainment on 11 of the 17 factors compared between the two stocks.

About Golden Entertainment

Golden Entertainment, Inc. owns and operates a diversified entertainment platform in the United States. The company operates through four segments; Nevada Casino Resorts, Nevada Locals Casinos, Nevada Taverns, and Distributed Gaming. It also operates casino, casino resorts, and taverns; and slot machines in third party non-casino locations. The company was incorporated in 1998 and is headquartered in Las Vegas, Nevada.

About Electronic Arts

Electronic Arts Inc. develops, markets, publishes, and distributes games, content, and services for game consoles, PCs, mobile phones, and tablets worldwide. It develops and publishes games and services across various genres, such as sports, racing, first-person shooter, action, role-playing, and simulation primarily under the Battlefield, The Sims, Apex Legends, Need for Speed, and license games from others, including FIFA, Madden NFL, UFC, and Star Wars brands. The company licenses its games to third parties to distribute and host its games. It markets and sells its games and services through digital distribution and retail channels, as well as directly to mass market retailers, specialty stores, and distribution arrangements. Electronic Arts Inc. was incorporated in 1982 and is headquartered in Redwood City, California.