Arcos Dorados (NYSE:ARCO) vs. Hilton Grand Vacations (NYSE:HGV) Head-To-Head Contrast

Arcos Dorados (NYSE:ARCO) and Hilton Grand Vacations (NYSE:HGV) are both consumer discretionary companies, but which is the better business? We will compare the two companies based on the strength of their risk, valuation, institutional ownership, earnings, analyst recommendations, dividends and profitability.

Analyst Recommendations

This is a summary of current ratings and target prices for Arcos Dorados and Hilton Grand Vacations, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Arcos Dorados	0	2	3	0	2.60
Hilton Grand Vacations	0	8	4	0	2.33

Arcos Dorados currently has a consensus price target of $10.50, suggesting a potential upside of 45.13%. Hilton Grand Vacations has a consensus price target of $54.67, suggesting a potential upside of 52.81%. Given Hilton Grand Vacations’ higher possible upside, analysts plainly believe Hilton Grand Vacations is more favorable than Arcos Dorados.

Risk & Volatility

Arcos Dorados has a beta of 0.49, indicating that its share price is 51% less volatile than the S&P 500. Comparatively, Hilton Grand Vacations has a beta of 1.5, indicating that its share price is 50% more volatile than the S&P 500.

Profitability

This table compares Arcos Dorados and Hilton Grand Vacations’ 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%
Hilton Grand Vacations	2.86%	20.40%	2.41%

Institutional & Insider Ownership

55.9% of Arcos Dorados shares are owned by institutional investors. Comparatively, 97.2% of Hilton Grand Vacations shares are owned by institutional investors. 3.1% of Hilton Grand Vacations shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Arcos Dorados and Hilton Grand Vacations”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Arcos Dorados	$4.68 billion	0.33	$212.12 million	$1.22	5.93
Hilton Grand Vacations	$5.05 billion	0.55	$81.00 million	$1.77	20.21

Arcos Dorados has higher earnings, but lower revenue than Hilton Grand Vacations. Arcos Dorados is trading at a lower price-to-earnings ratio than Hilton Grand Vacations, indicating that it is currently the more affordable of the two stocks.

Summary

Hilton Grand Vacations beats Arcos Dorados on 10 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 Hilton Grand Vacations

Hilton Grand Vacations Inc., a timeshare company, develops, markets, sells, manages, and operates the resorts, plans and ancillary reservation services under the Hilton Grand Vacations brand. It operates through Real Estate Sales and Financing, and Resort Operations and Club Management segments. Real Estate Sales and Financing segment market and sells the VOIs, and source VOIs through fee-for-service agreements with third-party developers; and provides consumer financing and services loans. Resort Operations and Club Management segment manages and operates the clubs which offers exchange, leisure travel, and reservation services, as well as engages in the rental of inventory made available due to ownership exchanges through its club programs, and provides ancillary services including food and beverage, retail and spa at timeshare properties. Hilton Grand Vacations Inc. was founded in 1992 and is headquartered in Orlando, Florida.