Critical Comparison: Reading International (NASDAQ:RDIB) & Madison Square Garden (NYSE:MSGS)

Reading International (NASDAQ:RDIB) and Madison Square Garden (NYSE:MSGS) are both communication services companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, risk, profitability, dividends, analyst recommendations, valuation and institutional ownership.

Valuation and Earnings

This table compares Reading International and Madison Square Garden”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Reading International	$214.46 million	N/A	N/A	($0.20)	-70.72
Madison Square Garden	$1.15 billion	8.19	$7.76 million	$0.30	1,308.81

Madison Square Garden has higher revenue and earnings than Reading International. Reading International is trading at a lower price-to-earnings ratio than Madison Square Garden, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Reading International and Madison Square Garden’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Reading International	N/A	N/A	N/A
Madison Square Garden	0.67%	-3.47%	0.64%

Institutional & Insider Ownership

0.4% of Reading International shares are held by institutional investors. Comparatively, 68.9% of Madison Square Garden shares are held by institutional investors. 5.4% of Reading International shares are held by company insiders. Comparatively, 19.1% of Madison Square Garden shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of recent ratings and price targets for Reading International and Madison Square Garden, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Reading International	1	0	0	0	1.00
Madison Square Garden	0	5	4	0	2.44

Madison Square Garden has a consensus target price of $471.20, indicating a potential upside of 20.01%. Given Madison Square Garden’s stronger consensus rating and higher possible upside, analysts clearly believe Madison Square Garden is more favorable than Reading International.

Summary

Madison Square Garden beats Reading International on 10 of the 11 factors compared between the two stocks.

About Reading International

Reading International, Inc. is an entertainment and real estate company, which engages in the development, ownership, and operation of multiplex cinemas and retail and commercial real estate in the United States, Australia, and New Zealand. It operates through the Cinema Exhibition and Real Estate segments. The Cinema Exhibition segment includes Reading Cinemas, Angelika Film Center, Consolidated Theatres, City Cinemas, 44 Union Square, and Liberty Theatres brands. The Real Estate segment comprises real estate development and the rental or licensing of retail, commercial and live theater assets. The company was founded by James J. Cotter Sr. in 1999 and is headquartered in Culver City, CA.

About Madison Square Garden

Madison Square Garden Sports Corp. operates as a professional sports company in the United States. The company owns and operates a portfolio of assets that consists of the New York Knickerbockers of the National Basketball Association (NBA) and the New York Rangers of the National Hockey League. Its other professional franchises include development league teams, the Hartford Wolf Pack of the American Hockey League and the Westchester Knicks of the NBA G League. The company also owns Knicks Gaming, an esports franchise that competes in the NBA 2K League. In addition, it operates professional sports team performance centers, the Madison Square Garden Training Center in Greenburgh. The company was formerly known as The Madison Square Garden Company. Madison Square Garden Sports Corp. was incorporated in 2015 and is based in New York, New York.