Comparing Red Rock Resorts (NASDAQ:RRR) & Tuniu (NASDAQ:TOUR)

Red Rock Resorts (NASDAQ:RRR) and Tuniu (NASDAQ:TOUR) are both consumer discretionary companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, institutional ownership, analyst recommendations, earnings, profitability, valuation and dividends.

Analyst Recommendations

This is a summary of current ratings and target prices for Red Rock Resorts and Tuniu, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Red Rock Resorts	0	4	14	1	2.84
Tuniu	1	0	0	0	1.00

Red Rock Resorts currently has a consensus target price of $69.35, suggesting a potential upside of 40.22%. Given Red Rock Resorts’ stronger consensus rating and higher probable upside, research analysts plainly believe Red Rock Resorts is more favorable than Tuniu.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Red Rock Resorts	5.79%	44.10%	3.01%
Tuniu	3.73%	3.17%	1.90%

Institutional and Insider Ownership

47.8% of Red Rock Resorts shares are held by institutional investors. 54.3% of Red Rock Resorts shares are held by company insiders. Comparatively, 76.1% of Tuniu shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Dividends

Red Rock Resorts pays an annual dividend of $1.04 per share and has a dividend yield of 2.1%. Tuniu pays an annual dividend of $1.18 per share and has a dividend yield of 24.8%. Red Rock Resorts pays out 52.5% of its earnings in the form of a dividend. Tuniu pays out 368.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Earnings & Valuation

This table compares Red Rock Resorts and Tuniu”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Red Rock Resorts	$2.01 billion	2.58	$188.07 million	$1.98	24.98
Tuniu	$82.65 million	0.63	$4.45 million	$0.32	14.84

Red Rock Resorts has higher revenue and earnings than Tuniu. Tuniu is trading at a lower price-to-earnings ratio than Red Rock Resorts, indicating that it is currently the more affordable of the two stocks.

Risk & 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, Tuniu has a beta of 0.47, meaning that its share price is 53% less volatile than the S&P 500.

Summary

Red Rock Resorts beats Tuniu on 15 of the 17 factors compared between the two stocks.

About Red Rock Resorts

Red Rock Resorts, Inc. is a gaming, entertainment and hospitality company focused on the Las Vegas market. Through its subsidiary Station Casinos LLC, it owns and operates casino resorts and other gaming and entertainment properties, primarily serving residents of the Las Vegas area. Its properties include casino gaming, restaurants, bars, hotels and entertainment venues. The company’s portfolio includes resorts such as Red Rock Casino Resort & Spa, Green Valley Ranch Resort Spa & Casino, and Durango Casino & Resort, along with several Station-branded properties.

About Tuniu

Tuniu Corporation (NASDAQ: TOUR) is a China-based online leisure travel company that operates the Tuniu.com platform. The company provides consumers with travel-planning and booking services, with a focus on organized package tours and self-guided travel products. Its offerings include domestic and international tour packages, transportation and accommodation reservations, attraction tickets, visa assistance, travel insurance, and other travel-related services. Tuniu also provides customized travel options and destination information through its website and mobile applications.