Marriot Vacations Worldwide Corporation (NYSE: VAC) and Hilton Grand Vacations (NYSE:HGV) are both mid-cap consumer discretionary companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, earnings, risk, dividends, profitability, institutional ownership and valuation.

Profitability

This table compares Marriot Vacations Worldwide Corporation and Hilton Grand Vacations’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Marriot Vacations Worldwide Corporation 7.90% 16.96% 6.53%
Hilton Grand Vacations N/A 88.54% 6.44%

Analyst Ratings

This is a summary of recent ratings and target prices for Marriot Vacations Worldwide Corporation and Hilton Grand Vacations, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Marriot Vacations Worldwide Corporation 0 2 4 0 2.67
Hilton Grand Vacations 0 0 8 0 3.00

Marriot Vacations Worldwide Corporation currently has a consensus target price of $124.83, indicating a potential upside of 9.31%. Hilton Grand Vacations has a consensus target price of $38.25, indicating a potential upside of 5.34%. Given Marriot Vacations Worldwide Corporation’s higher possible upside, research analysts clearly believe Marriot Vacations Worldwide Corporation is more favorable than Hilton Grand Vacations.

Dividends

Marriot Vacations Worldwide Corporation pays an annual dividend of $1.40 per share and has a dividend yield of 1.2%. Hilton Grand Vacations does not pay a dividend. Marriot Vacations Worldwide Corporation pays out 25.2% of its earnings in the form of a dividend. Marriot Vacations Worldwide Corporation has increased its dividend for 2 consecutive years.

Valuation and Earnings

This table compares Marriot Vacations Worldwide Corporation and Hilton Grand Vacations’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Marriot Vacations Worldwide Corporation $1.36 billion 2.27 $268.31 million $5.56 20.54
Hilton Grand Vacations $1.53 billion 2.35 $383.00 million N/A N/A

Hilton Grand Vacations has higher revenue and earnings than Marriot Vacations Worldwide Corporation.

Insider & Institutional Ownership

75.6% of Marriot Vacations Worldwide Corporation shares are held by institutional investors. Comparatively, 97.9% of Hilton Grand Vacations shares are held by institutional investors. 3.3% of Marriot Vacations Worldwide Corporation shares are held by insiders. Comparatively, 0.5% of Hilton Grand Vacations shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Summary

Hilton Grand Vacations beats Marriot Vacations Worldwide Corporation on 8 of the 14 factors compared between the two stocks.

Marriot Vacations Worldwide Corporation Company Profile

Marriott Vacations Worldwide Corporation focuses on vacation ownership, based on number of owners, number of resorts and revenues. The Company is an exclusive worldwide developer, marketer, seller and manager of vacation ownership and related products under the Marriott Vacation Club and Grand Residences by Marriott brands. The Company operates through three segments North America, Europe and Asia Pacific. In the North America segment, it develops, markets, sells and manages vacation ownership and related products under the Marriott Vacation Club and Grand Residences by Marriott brands. Its Europe segment is engaged in selling its existing projects and managing existing resorts. Its Asia Pacific segment, it develops, markets, sells and manages two points-based programs that it designed to appeal to the vacation preferences of the market, Marriott Vacation Club, Asia Pacific and Marriott Vacation Club Destinations, Australia, as well as a weeks-based right-to-use product.

Hilton Grand Vacations Company Profile

Hilton Grand Vacations Inc. is a timeshare company that markets and sells vacation ownership intervals (VOIs), manages resorts in leisure and urban destinations, and operates a points-based vacation club. The Company operates its business across two segments: Real Estate Sales and Financing, and Resort Operations and Club Management. As of September 30, 2016, the Company had 46 resorts, representing 7,592 units, and approximately 265,000 Hilton Grand Vacations Club (the Club) members. Club members can exchange their Club points for stays at any resort or any property in the Hilton system of various brands across over 4,700 properties, as well as various vacation options, such as cruises and guided tours. VOI product allows customers to purchase a lifetime of vacations. The Company offers amenities, such as full kitchens, in-unit washers and dryers, spas and kids’ clubs along with beach-front locations.

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