Las Vegas Sands (NYSE:LVS) versus Capcom (OTCMKTS:CCOEY) Critical Review

Capcom (OTCMKTS:CCOEY) and Las Vegas Sands (NYSE:LVS) are both large-cap consumer discretionary companies, but which is the better stock? We will contrast the two businesses based on the strength of their institutional ownership, valuation, analyst recommendations, profitability, risk, dividends and earnings.

Insider and Institutional Ownership

39.2% of Las Vegas Sands shares are owned by institutional investors. 1.2% of Las Vegas Sands shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Capcom and Las Vegas Sands’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Capcom	31.30%	26.74%	21.01%
Las Vegas Sands	12.69%	73.14%	8.87%

Volatility & Risk

Capcom has a beta of 0.72, indicating that its share price is 28% less volatile than the S&P 500. Comparatively, Las Vegas Sands has a beta of 0.97, indicating that its share price is 3% less volatile than the S&P 500.

Dividends

Capcom pays an annual dividend of $0.07 per share and has a dividend yield of 0.6%. Las Vegas Sands pays an annual dividend of $1.00 per share and has a dividend yield of 1.5%. Capcom pays out 14.6% of its earnings in the form of a dividend. Las Vegas Sands pays out 45.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Las Vegas Sands has raised its dividend for 2 consecutive years. Las Vegas Sands is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Capcom and Las Vegas Sands, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Capcom	0	1	1	0	2.50
Las Vegas Sands	0	5	11	2	2.83

Las Vegas Sands has a consensus target price of $67.52, indicating a potential upside of 0.89%. Given Las Vegas Sands’ stronger consensus rating and higher possible upside, analysts plainly believe Las Vegas Sands is more favorable than Capcom.

Valuation & Earnings

This table compares Capcom and Las Vegas Sands”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Capcom	$1.11 billion	10.80	$319.78 million	$0.48	23.50
Las Vegas Sands	$11.30 billion	4.00	$1.45 billion	$2.21	30.28

Las Vegas Sands has higher revenue and earnings than Capcom. Capcom is trading at a lower price-to-earnings ratio than Las Vegas Sands, indicating that it is currently the more affordable of the two stocks.

Summary

Las Vegas Sands beats Capcom on 14 of the 18 factors compared between the two stocks.

About Capcom

Capcom Co., Ltd. plans, develops, manufactures, sells, and distributes home video games, online games, mobile games, and arcade games in Japan and internationally. It operates through Digital Contents, Arcade Operations, Amusement Equipments, and Other Businesses segments. The Digital Contents segment develops and sells digital game content for consumer home video game platforms, as well as mobile content and PC online games. The Arcade Operations segment operates Plaza Capcom amusement facilities primarily in commercial complexes, as well as hosts various events. The Amusement Equipments segment is involved in the development, manufacture, and sale of software, frames and LCD devices for gaming machines. The Other Businesses segment engages in the adapting game content into movies, animated television programs, music CDs, and merchandise; and devoting resources to esports. Capcom Co., Ltd. was incorporated in 1979 and is headquartered in Osaka, Japan.

About Las Vegas Sands

Las Vegas Sands Corp., together with its subsidiaries, develops, owns, and operates integrated resorts in Macao and Singapore. It owns and operates The Venetian Macao Resort Hotel, the Londoner Macao, The Parisian Macao, The Plaza Macao and Four Seasons Hotel Macao, Cotai Strip, and the Sands Macao in Macao, the People’s Republic of China; and Marina Bay Sands in Singapore. The company’s integrated resorts feature accommodations, gaming, entertainment and retail malls, convention and exhibition facilities, celebrity chef restaurants, and other amenities. Las Vegas Sands Corp. was founded in 1988 and is based in Las Vegas, Nevada.