Head-To-Head Review: Planet Fitness (NYSE:PLNT) & Royal Caribbean Cruises (NYSE:RCL)

Planet Fitness (NYSE:PLNT) and Royal Caribbean Cruises (NYSE:RCL) are both consumer discretionary companies, but which is the superior investment? We will contrast the two businesses based on the strength of their dividends, risk, analyst recommendations, earnings, profitability, institutional ownership and valuation.

Profitability

This table compares Planet Fitness and Royal Caribbean Cruises’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Planet Fitness	16.52%	-81.29%	8.66%
Royal Caribbean Cruises	24.36%	45.25%	11.13%

Earnings and Valuation

This table compares Planet Fitness and Royal Caribbean Cruises”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Planet Fitness	$1.32 billion	3.17	$219.10 million	$2.77	19.11
Royal Caribbean Cruises	$17.94 billion	4.67	$4.27 billion	$16.39	19.07

Royal Caribbean Cruises has higher revenue and earnings than Planet Fitness. Royal Caribbean Cruises is trading at a lower price-to-earnings ratio than Planet Fitness, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Planet Fitness has a beta of 1.04, meaning that its share price is 4% more volatile than the S&P 500. Comparatively, Royal Caribbean Cruises has a beta of 1.77, meaning that its share price is 77% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent recommendations for Planet Fitness and Royal Caribbean Cruises, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Planet Fitness	1	9	11	1	2.55
Royal Caribbean Cruises	1	5	14	1	2.71

Planet Fitness currently has a consensus target price of $77.81, indicating a potential upside of 47.02%. Royal Caribbean Cruises has a consensus target price of $345.53, indicating a potential upside of 10.54%. Given Planet Fitness’ higher possible upside, equities research analysts plainly believe Planet Fitness is more favorable than Royal Caribbean Cruises.

Insider & Institutional Ownership

95.5% of Planet Fitness shares are held by institutional investors. Comparatively, 87.5% of Royal Caribbean Cruises shares are held by institutional investors. 0.9% of Planet Fitness shares are held by company insiders. Comparatively, 6.4% of Royal Caribbean Cruises shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

Royal Caribbean Cruises beats Planet Fitness on 11 of the 14 factors compared between the two stocks.

About Planet Fitness

Planet Fitness, Inc., together with its subsidiaries, franchises and operates fitness centers under the Planet Fitness brand. The company operates through three segments: Franchise, Corporate-Owned Stores, and Equipment. The company is involved in franchising business in the United States, Puerto Rico, Canada, Panama, Mexico, and Australia. It engages in the sale of fitness equipment to franchisee-owned stores in the United States, Canada, and Mexico. In addition, the company operates corporate-owned stores in the United States and Canada. Planet Fitness, Inc. was founded in 1992 and is headquartered in Hampton, New Hampshire.

About Royal Caribbean Cruises

Royal Caribbean Cruises Ltd. operates as a cruise company worldwide. The company operates cruises under the Royal Caribbean International, Celebrity Cruises, and Silversea Cruises brands, which comprise a range of itineraries. As of February 21, 2024, it operated 65 ships. Royal Caribbean Cruises Ltd. was founded in 1968 and is headquartered in Miami, Florida.