Reservoir Media (NASDAQ:RSVR) vs. Liberty Media Corporation – Liberty Formula One Series A (NASDAQ:FWONA) Critical Analysis

Liberty Media Corporation – Liberty Formula One Series A (NASDAQ:FWONA) and Reservoir Media (NASDAQ:RSVR) are both consumer discretionary companies, but which is the better investment? We will compare the two companies based on the strength of their analyst recommendations, valuation, profitability, dividends, earnings, institutional ownership and risk.

Volatility & Risk

Liberty Media Corporation – Liberty Formula One Series A has a beta of 0.54, suggesting that its stock price is 46% less volatile than the S&P 500. Comparatively, Reservoir Media has a beta of 0.88, suggesting that its stock price is 12% less volatile than the S&P 500.

Earnings & Valuation

This table compares Liberty Media Corporation – Liberty Formula One Series A and Reservoir Media”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Liberty Media Corporation – Liberty Formula One Series A	$3.32 billion	6.67	$195.04 million	$0.78	113.40
Reservoir Media	$158.71 million	3.10	$7.75 million	$0.14	53.50

Liberty Media Corporation – Liberty Formula One Series A has higher revenue and earnings than Reservoir Media. Reservoir Media is trading at a lower price-to-earnings ratio than Liberty Media Corporation – Liberty Formula One Series A, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of current ratings for Liberty Media Corporation – Liberty Formula One Series A and Reservoir Media, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Liberty Media Corporation – Liberty Formula One Series A	1	3	3	1	2.50
Reservoir Media	0	2	1	0	2.33

Liberty Media Corporation – Liberty Formula One Series A presently has a consensus target price of $103.00, indicating a potential upside of 16.45%. Reservoir Media has a consensus target price of $11.50, indicating a potential upside of 53.54%. Given Reservoir Media’s higher probable upside, analysts plainly believe Reservoir Media is more favorable than Liberty Media Corporation – Liberty Formula One Series A.

Profitability

This table compares Liberty Media Corporation – Liberty Formula One Series A and Reservoir Media’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Liberty Media Corporation – Liberty Formula One Series A	N/A	N/A	N/A
Reservoir Media	5.78%	2.62%	1.11%

Institutional and Insider Ownership

8.4% of Liberty Media Corporation – Liberty Formula One Series A shares are owned by institutional investors. Comparatively, 44.4% of Reservoir Media shares are owned by institutional investors. 3.0% of Liberty Media Corporation – Liberty Formula One Series A shares are owned by company insiders. Comparatively, 27.0% of Reservoir Media shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Summary

Liberty Media Corporation – Liberty Formula One Series A beats Reservoir Media on 8 of the 15 factors compared between the two stocks.

About Liberty Media Corporation – Liberty Formula One Series A

Formula One Group, through its subsidiary Formula 1, engages in the motorsports business in the United States and internationally. The company holds commercial rights for the FIA Formula One world championship, approximately a nine-month long motor race-based competition in which teams compete for the constructors' championship and drivers compete for the drivers' championship. It is also involved in the operation of the Formula 1 Paddock Club hospitality program; and provision of freight, logistical, and travel related services for the teams and other third parties, as well as the F2 and F3 race series. The company was founded in 1950 and is based in Englewood, Colorado. Formula One Group operates as a subsidiary of Liberty Media Corporation.

About Reservoir Media

Reservoir Media, Inc. operates as a music publishing company. It operates through two segments, Music Publishing and Recorded Music. The Music Publishing segment acquires interests in music catalogs, as well as signs songwriters. The Recorded Music segment engages in the acquisition of sound recording catalogs; discovery and development of recording artists; and marketing, distribution, sale, and licensing of the music catalogs. The company was founded in 2007 and is headquartered in New York, New York.