Contrasting Target Hospitality (NASDAQ:TH) & Marcus (NYSE:MCS)

Target Hospitality (NASDAQ:TH) and Marcus (NYSE:MCS) are both small-cap consumer discretionary companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, valuation, earnings, risk, dividends, analyst recommendations and profitability.

Insider & Institutional Ownership

32.4% of Target Hospitality shares are owned by institutional investors. Comparatively, 81.6% of Marcus shares are owned by institutional investors. 68.0% of Target Hospitality shares are owned by company insiders. Comparatively, 5.0% of Marcus shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares Target Hospitality and Marcus”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Target Hospitality	$386.27 million	2.32	$71.26 million	$0.10	90.00
Marcus	$775.79 million	0.63	-$7.79 million	$0.45	34.96

Target Hospitality has higher earnings, but lower revenue than Marcus. Marcus is trading at a lower price-to-earnings ratio than Target Hospitality, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent recommendations for Target Hospitality and Marcus, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Target Hospitality	0	1	2	1	3.00
Marcus	0	0	3	1	3.25

Target Hospitality currently has a consensus target price of $13.00, suggesting a potential upside of 44.44%. Marcus has a consensus target price of $24.50, suggesting a potential upside of 55.73%. Given Marcus’ stronger consensus rating and higher probable upside, analysts clearly believe Marcus is more favorable than Target Hospitality.

Profitability

This table compares Target Hospitality and Marcus’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Target Hospitality	3.58%	3.26%	2.13%
Marcus	1.91%	4.28%	1.88%

Volatility and Risk

Target Hospitality has a beta of 1.92, indicating that its share price is 92% more volatile than the S&P 500. Comparatively, Marcus has a beta of 1.24, indicating that its share price is 24% more volatile than the S&P 500.

About Target Hospitality

Target Hospitality Corp. operates as a specialty rental and hospitality services company in North America. The company operates through two segments, Hospitality & Facilities Services – South and Government. It owns a network of specialty rental accommodation units. In addition, the company provides catering and food, maintenance, housekeeping, grounds-keeping, security, health and recreation facilities, workforce community management, concierge, and laundry services. It serves the U.S. government contractors and investment grade natural resource development companies. Target Hospitality Corp. was founded in 1978 and is headquartered in The Woodlands, Texas.

About Marcus

The Marcus Corporation, together with its subsidiaries, owns and operates movie theatres, and hotels and resorts in the United States. It operates a family entertainment center and multiscreen motion picture theatres under the Big Screen Bistro, Big Screen Bistro Express, BistroPlex, and Movie Tavern by Marcus brand names. The company also owns and operates full-service hotels and resorts, as well as manages full-service hotels, resorts, and other properties. In addition, it provides hospitality management services, including check-in, housekeeping, and maintenance for a vacation ownership development; and manages condominium hotels under long-term management contracts. The Marcus Corporation was founded in 1935 and is headquartered in Milwaukee, Wisconsin.