Arcos Dorados (NYSE:ARCO – Get Free Report) and Full House Resorts (NASDAQ:FLL – Get Free Report) are both small-cap consumer discretionary companies, but which is the better business? We will contrast the two companies based on the strength of their risk, profitability, earnings, dividends, analyst recommendations, valuation and institutional ownership.
Institutional and Insider Ownership
55.9% of Arcos Dorados shares are owned by institutional investors. Comparatively, 37.7% of Full House Resorts shares are owned by institutional investors. 10.6% of Full House Resorts shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
Analyst Recommendations
This is a summary of recent recommendations for Arcos Dorados and Full House Resorts, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Arcos Dorados | 0 | 2 | 3 | 1 | 2.83 |
| Full House Resorts | 1 | 0 | 3 | 0 | 2.50 |
Arcos Dorados currently has a consensus price target of $9.75, indicating a potential upside of 44.87%. Full House Resorts has a consensus price target of $3.50, indicating a potential upside of 323.22%. Given Full House Resorts’ higher possible upside, analysts plainly believe Full House Resorts is more favorable than Arcos Dorados.
Valuation & Earnings
This table compares Arcos Dorados and Full House Resorts”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Arcos Dorados | $4.68 billion | 0.30 | $212.12 million | $1.22 | 5.52 |
| Full House Resorts | $302.38 million | 0.10 | -$40.20 million | ($1.02) | -0.81 |
Arcos Dorados has higher revenue and earnings than Full House Resorts. Full House Resorts is trading at a lower price-to-earnings ratio than Arcos Dorados, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Arcos Dorados and Full House Resorts’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Arcos Dorados | 5.15% | 12.50% | 2.58% |
| Full House Resorts | -12.06% | -473.31% | -5.78% |
Volatility and Risk
Arcos Dorados has a beta of 0.48, meaning that its share price is 52% less volatile than the S&P 500. Comparatively, Full House Resorts has a beta of 1.41, meaning that its share price is 41% more volatile than the S&P 500.
Summary
Arcos Dorados beats Full House Resorts on 11 of the 14 factors compared between the two stocks.
About Arcos Dorados
Arcos Dorados Holdings Inc. operates as a franchisee of McDonald’s restaurants. It has the exclusive right to own, operate, and grant franchises of McDonald’s restaurants in 20 countries and territories in Latin America and the Caribbean, including Argentina, Aruba, Brazil, Chile, Colombia, Costa Rica, Curacao, Ecuador, French Guiana, Guadeloupe, Martinique, Mexico, Panama, Peru, Puerto Rico, Trinidad and Tobago, Uruguay, the U.S. Virgin Islands of St. Croix and St. Thomas, and Venezuela. The company was founded in 2007 and is based in Montevideo, Uruguay.
About Full House Resorts
Full House Resorts, Inc. owns, leases, operates, develops, manages, and invests in casinos, and related hospitality and entertainment facilities in the United States. It operates through Midwest & South, West, and Contracted Sports Wagering segments. The company's properties include American Place in Waukegan, Illinois; Silver Slipper Casino and Hotel in Hancock County, Mississippi; Rising Star Casino Resort in Rising Sun, Indiana; Bronco Billy's Casino and Chamonix Casino Hotel in Cripple Creek, Colorado; Stockman's Casino in Fallon, Nevada; and Grand Lodge Casino, located within the Hyatt Regency Lake Tahoe Resort, Spa and Casino in Incline Village, Nevada. It also offers online sports wagering services. The company was incorporated in 1987 and is headquartered in Las Vegas, Nevada.
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