Comparing Target Hospitality (NASDAQ:TH) and Carnival (NYSE:CUK)

Target Hospitality (NASDAQ:TH) and Carnival (NYSE:CUK) are both consumer discretionary companies, but which is the better business? We will contrast the two companies based on the strength of their dividends, valuation, institutional ownership, earnings, profitability, risk and analyst recommendations.

Volatility & Risk

Target Hospitality has a beta of 1.12, suggesting that its stock price is 12% more volatile than the S&P 500. Comparatively, Carnival has a beta of 2.51, suggesting that its stock price is 151% more volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Target Hospitality	-11.58%	-8.65%	-6.41%
Carnival	11.48%	26.92%	6.20%

Valuation & Earnings

This table compares Target Hospitality and Carnival”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Target Hospitality	$320.64 million	4.56	-$37.12 million	($0.38)	-38.45
Carnival	$26.62 billion	0.19	$2.76 billion	$2.25	11.94

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

Institutional and Insider Ownership

32.4% of Target Hospitality shares are held by institutional investors. Comparatively, 23.8% of Carnival shares are held by institutional investors. 3.8% of Target Hospitality shares are held by company insiders. Comparatively, 0.1% of Carnival shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current ratings for Target Hospitality and Carnival, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Target Hospitality	1	0	2	1	2.75
Carnival	0	1	1	0	2.50

Target Hospitality presently has a consensus price target of $16.50, suggesting a potential upside of 12.94%. Given Target Hospitality’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Target Hospitality is more favorable than Carnival.

Summary

Carnival beats Target Hospitality on 8 of the 15 factors compared between the two stocks.

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 Carnival

Carnival Plc operates as a global cruise and vacation company. The firm offers holiday and vacation products to a customer base that is broadly varied in terms of cultures, languages and leisure-time preferences. It operates through the North America and Australia (NAA), Europe and Asia (EA), Cruise Support, and Tour and Other segments. The NAA segment includes Carnival Cruise Line, Holland America Line, P and O Cruises (Australia), Princess and Seabourn. The EA segment includes AIDA, Costa, Cunard, and P and O Cruises (UK). The Cruise Support segment includes a portfolio of port destinations and other services, all of which are operated for the benefit of cruise brands. The Tour and Other segment represents the hotel and transportation operations of Holland America Princess Alaska Tours and other operations. The company was founded on July 19, 2000 and is headquartered in Southampton, the United Kingdom.