Comparing GameStop (NYSE:GME) and Flutter Entertainment (NYSE:FLUT)

GameStop (NYSE:GME) and Flutter Entertainment (NYSE:FLUT) are both large-cap consumer discretionary companies, but which is the superior business? We will contrast the two companies based on the strength of their risk, valuation, institutional ownership, earnings, dividends, profitability and analyst recommendations.

Earnings and Valuation

This table compares GameStop and Flutter Entertainment”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
GameStop	$3.63 billion	2.89	$418.40 million	$0.75	31.17
Flutter Entertainment	$16.38 billion	1.12	-$310.00 million	($1.80)	-58.60

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

Insider & Institutional Ownership

29.2% of GameStop shares are held by institutional investors. 8.6% of GameStop shares are held by company insiders. Comparatively, 0.1% of Flutter Entertainment shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares GameStop and Flutter Entertainment’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
GameStop	11.53%	12.47%	6.73%
Flutter Entertainment	-1.89%	12.12%	4.19%

Analyst Recommendations

This is a breakdown of recent ratings for GameStop and Flutter Entertainment, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
GameStop	1	1	0	0	1.50
Flutter Entertainment	2	6	15	2	2.68

GameStop presently has a consensus target price of $13.50, indicating a potential downside of 42.25%. Flutter Entertainment has a consensus target price of $216.90, indicating a potential upside of 105.64%. Given Flutter Entertainment’s stronger consensus rating and higher possible upside, analysts plainly believe Flutter Entertainment is more favorable than GameStop.

Volatility and Risk

GameStop has a beta of 1.86, meaning that its stock price is 86% more volatile than the S&P 500. Comparatively, Flutter Entertainment has a beta of 1.93, meaning that its stock price is 93% more volatile than the S&P 500.

Summary

GameStop beats Flutter Entertainment on 9 of the 15 factors compared between the two stocks.

About GameStop

GameStop Corp., a specialty retailer, provides games and entertainment products through its stores and ecommerce platforms in the United States, Canada, Australia, and Europe. The company sells new and pre-owned gaming platforms; accessories, such as controllers, gaming headsets, and virtual reality products; new and pre-owned gaming software; and in-game digital currency, digital downloadable content, and full-game downloads. It sells collectibles comprising apparel, toys, trading cards, gadgets, and other retail products for pop culture and technology enthusiasts, as well as engages in the digital asset wallet and NFT marketplace activities. The company operates stores and ecommerce sites under the GameStop, EB Games, and Micromania brands; and pop culture themed stores that sell collectibles, apparel, gadgets, electronics, toys, and other retail products under the Zing Pop Culture brand, as well as offers Game Informer magazine, a print and digital gaming publication. The company was formerly known as GSC Holdings Corp. GameStop Corp. was founded in 1996 and is headquartered in Grapevine, Texas.

About Flutter Entertainment

Flutter Entertainment plc operates as a sports betting and gaming company in the United Kingdom, Ireland, Australia, the United States, Italy, and internationally. The company operates through four segments: UK & Ireland, Australia, International, and US. It offers sports betting, iGaming, daily fantasy sports, online racing wagering, and TV broadcasting products; sportsbooks and exchange sports betting products, and gaming products; and online sports betting. In addition, it provides online poker, casino, and rummy. Further, it provides sports betting and gaming services through paddypower.com, betfair.com, sportsbet.com.au, tvg.com, us.betfair.com, fanduel.com, adjarabet.com, pokerstars.com, Skybet.com, tombola.com, sisal.com, and maxbet.rs websites under the FanDuel, Sky Betting & Gaming, Sportsbet, PokerStars, Paddy Power, Sisal, tombola, Betfair, MaxBet, TVG, Stardust, Junglee Games, and Adjarabet brands, as well as live poker tours and events. The company was formerly known as Paddy Power Betfair plc and changed its name to Flutter Entertainment plc in 2019. Flutter Entertainment plc was incorporated in 1958 and is headquartered in Dublin, Ireland.