Red Rock Resorts (RRR) versus The Competition Financial Analysis

Red Rock Resorts (NASDAQ:RRR) is one of 382 publicly-traded companies in the “Hotels, Restaurants & Leisure” industry, but how does it contrast to its competitors? We will compare Red Rock Resorts to related companies based on the strength of its profitability, dividends, institutional ownership, earnings, analyst recommendations, risk and valuation.

Profitability

This table compares Red Rock Resorts and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Red Rock Resorts	5.79%	44.39%	2.98%
Red Rock Resorts Competitors	8.52%	-40.63%	2.09%

Risk and Volatility

Red Rock Resorts has a beta of 1.42, meaning that its share price is 42% more volatile than the S&P 500. Comparatively, Red Rock Resorts’ competitors have a beta of 1.44, meaning that their average share price is 44% more volatile than the S&P 500.

Valuation and Earnings

This table compares Red Rock Resorts and its competitors gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Red Rock Resorts	$2.01 billion	$188.07 million	25.07
Red Rock Resorts Competitors	$3.72 billion	$250.18 million	-156.46

Red Rock Resorts’ competitors have higher revenue and earnings than Red Rock Resorts. Red Rock Resorts is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Analyst Recommendations

This is a summary of current ratings and target prices for Red Rock Resorts and its competitors, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Red Rock Resorts	0	4	14	1	2.84
Red Rock Resorts Competitors	3807	17293	25614	906	2.50

Red Rock Resorts currently has a consensus price target of $69.35, indicating a potential upside of 39.70%. As a group, “Hotels, Restaurants & Leisure” companies have a potential upside of 58.83%. Given Red Rock Resorts’ competitors higher probable upside, analysts plainly believe Red Rock Resorts has less favorable growth aspects than its competitors.

Insider and Institutional Ownership

47.8% of Red Rock Resorts shares are held by institutional investors. Comparatively, 48.7% of shares of all “Hotels, Restaurants & Leisure” companies are held by institutional investors. 54.3% of Red Rock Resorts shares are held by company insiders. Comparatively, 22.1% of shares of all “Hotels, Restaurants & Leisure” companies are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Dividends

Red Rock Resorts pays an annual dividend of $1.04 per share and has a dividend yield of 2.1%. Red Rock Resorts pays out 52.5% of its earnings in the form of a dividend. As a group, “Hotels, Restaurants & Leisure” companies pay a dividend yield of 3.2% and pay out 39.1% of their earnings in the form of a dividend. Red Rock Resorts lags its competitors as a dividend stock, given its lower dividend yield and higher payout ratio.

Summary

Red Rock Resorts competitors beat Red Rock Resorts on 8 of the 15 factors compared.

About Red Rock Resorts

Red Rock Resorts, Inc., through its interest in Station Casinos LLC, develops and operates casino and entertainment properties in the United States. The company owns and operates gaming and entertainment facilities, including Durango Casino & Resort and smaller casinos in the Las Vegas regional market. The company was formerly known as Station Casinos Corp. and changed its name to Red Rock Resorts, Inc. in January 2016. Red Rock Resorts, Inc. was founded in 1976 and is based in Las Vegas, Nevada.