Head-To-Head Review: Archon (OTCMKTS:ARHN) vs. GameStop (NYSE:GME)

GameStop (NYSE:GME) and Archon (OTCMKTS:ARHN) are both consumer discretionary companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, earnings, analyst recommendations, dividends, institutional ownership, valuation and risk.

Analyst Recommendations

This is a breakdown of current ratings for GameStop and Archon, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
GameStop	1	1	0	0	1.50
Archon	0	0	0	0	0.00

GameStop presently has a consensus target price of $13.50, indicating a potential downside of 42.59%. Given GameStop’s stronger consensus rating and higher probable upside, equities research analysts plainly believe GameStop is more favorable than Archon.

Profitability

This table compares GameStop and Archon’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
GameStop	11.08%	9.75%	5.80%
Archon	N/A	N/A	N/A

Valuation & Earnings

This table compares GameStop and Archon”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
GameStop	$3.82 billion	2.76	$131.30 million	$0.82	28.68
Archon	N/A	N/A	N/A	N/A	N/A

GameStop has higher revenue and earnings than Archon.

Institutional & Insider Ownership

29.2% of GameStop shares are owned by institutional investors. 8.6% of GameStop shares are owned by company insiders. Comparatively, 80.0% of Archon shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Volatility and Risk

GameStop has a beta of 2.02, meaning that its share price is 102% more volatile than the S&P 500. Comparatively, Archon has a beta of 0.06, meaning that its share price is 94% less volatile than the S&P 500.

Summary

GameStop beats Archon on 8 of the 9 factors compared between the two stocks.

About GameStop

GameStop Corp., a specialty retailer, provides games and entertainment products through its stores and ecommerce platforms in the United States, Canada, Australia, and Europe. The company sells new and pre-owned gaming platforms; accessories, such as controllers, gaming headsets, and virtual reality products; new and pre-owned gaming software; and in-game digital currency, digital downloadable content, and full-game downloads. It sells collectibles comprising apparel, toys, trading cards, gadgets, and other retail products for pop culture and technology enthusiasts, as well as engages in the digital asset wallet and NFT marketplace activities. The company operates stores and ecommerce sites under the GameStop, EB Games, and Micromania brands; and pop culture themed stores that sell collectibles, apparel, gadgets, electronics, toys, and other retail products under the Zing Pop Culture brand, as well as offers Game Informer magazine, a print and digital gaming publication. The company was formerly known as GSC Holdings Corp. GameStop Corp. was founded in 1996 and is headquartered in Grapevine, Texas.

About Archon

Archon Corporation, through its subsidiary, Pioneer Hotel Inc., engages in the ownership, management, and operation of casinos and hotels in the United States. It operates the Pioneer Hotel & Gambling Hall (the Pioneer) in Laughlin, Nevada that consists of a casino. The company also owns real estate properties on Las Vegas Boulevard South in Las Vegas, Nevada; and rental properties that include commercial office space in Dorchester, Massachusetts. Archon Corporation was founded in 1991 and is based in Laughlin, Nevada.