Analyzing Stars Group (TSG) & Weibo (WB)

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Stars Group (NASDAQ: TSG) and Weibo (NASDAQ:WB) are both consumer discretionary companies, but which is the better business? We will compare the two businesses based on the strength of their earnings, dividends, valuation, institutional ownership, profitability, risk and analyst recommendations.

Institutional and Insider Ownership

64.3% of Stars Group shares are held by institutional investors. Comparatively, 23.7% of Weibo shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of recent recommendations and price targets for Stars Group and Weibo, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Stars Group 0 1 0 0 2.00
Weibo 0 1 8 0 2.89

Weibo has a consensus target price of $135.13, suggesting a potential upside of 37.64%. Given Weibo’s stronger consensus rating and higher probable upside, analysts plainly believe Weibo is more favorable than Stars Group.

Profitability

This table compares Stars Group and Weibo’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Stars Group 19.39% 24.66% 8.95%
Weibo 31.12% 36.15% 19.78%

Earnings & Valuation

This table compares Stars Group and Weibo’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Stars Group $1.31 billion 4.34 $259.23 million $2.25 16.58
Weibo $1.15 billion 18.88 $352.59 million $1.56 62.93

Weibo has lower revenue, but higher earnings than Stars Group. Stars Group is trading at a lower price-to-earnings ratio than Weibo, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Stars Group has a beta of 1.81, suggesting that its share price is 81% more volatile than the S&P 500. Comparatively, Weibo has a beta of 2.54, suggesting that its share price is 154% more volatile than the S&P 500.

Summary

Weibo beats Stars Group on 10 of the 13 factors compared between the two stocks.

About Stars Group

The Stars Group Inc. provides technology-based products and services to gaming and interactive entertainment industries in Canada and internationally. It owns and operates gaming and related interactive entertainment businesses under the PokerStars, PokerStars Casino, BetStars, Full Tilt, the PokerStars Players No Limit Hold'em Championship, European Poker Tour, PokerStars Caribbean Adventure, Latin American Poker Tour, Asia Pacific Poker Tour, PokerStars Festival, and PokerStars MEGASTACK live poker tour and event brands, The company was formerly known as Amaya, Inc. and changed its name to The Stars Group Inc. in August 2017. The Stars Group Inc. was founded in 2004 and is headquartered in Toronto, Canada.

About Weibo

Weibo Corporation, through its subsidiaries, operates as a social media platform for people to create, distribute, and discover Chinese-language content. It operates through two segments, Advertising and Marketing Services, and Value-Added Services. The company offers self-expression products that enable its users to express themselves on its platform; social products to promote social interaction between users on its platform; and discovery products to help users discover content on its platform. It also provides third-party online games, including role-play, card, and strategy games, as well as various services and functions to VIP members. In addition, the company offers advertising and marketing solutions, such as social display advertisements; and promoted feeds, accounts, and trends enable its customers to promote their brands and conduct marketing activities. Further, it provides copyright content, such as TV channels, online video Websites, and operators with copyright content through traffic resource exchange and content traffic sharing; MCNs and other self-media to manage and provide services to content creators on Weibo, such as MCNs, unions, and e-commerce partners; other app developers an application platform which allows users to log into third-party applications; and Weibo Wallet products that enable platform partners to conduct interest generation activities on Weibo. The company was formerly known as T.CN Corporation and changed its name to Weibo Corporation in 2012. The company was founded in 2009 and is headquartered in Beijing, China. Weibo Corporation is a subsidiary of SINA Corporation.

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