Meridian (NASDAQ:MRDN) & Hilton Worldwide (NYSE:HLT) Critical Review

Meridian (NASDAQ:MRDN) and Hilton Worldwide (NYSE:HLT) are both consumer discretionary companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, earnings, valuation, analyst recommendations, risk, institutional ownership and dividends.

Analyst Ratings

This is a summary of recent ratings and price targets for Meridian and Hilton Worldwide, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Meridian	1	0	0	0	1.00
Hilton Worldwide	0	8	16	2	2.77

Meridian currently has a consensus target price of $21.60, indicating a potential upside of 108.70%. Hilton Worldwide has a consensus target price of $356.65, indicating a potential upside of 1.93%. Given Meridian’s higher probable upside, equities research analysts plainly believe Meridian is more favorable than Hilton Worldwide.

Valuation & Earnings

This table compares Meridian and Hilton Worldwide”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Meridian	$182.86 million	0.72	-$89.90 million	($6.74)	-1.54
Hilton Worldwide	$12.04 billion	6.54	$1.46 billion	$6.81	51.38

Hilton Worldwide has higher revenue and earnings than Meridian. Meridian is trading at a lower price-to-earnings ratio than Hilton Worldwide, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Meridian and Hilton Worldwide’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Meridian	-41.41%	-117.87%	-58.87%
Hilton Worldwide	12.69%	-35.24%	11.84%

Volatility & Risk

Meridian has a beta of 0.7, meaning that its share price is 30% less volatile than the S&P 500. Comparatively, Hilton Worldwide has a beta of 1.1, meaning that its share price is 10% more volatile than the S&P 500.

Insider and Institutional Ownership

2.7% of Meridian shares are owned by institutional investors. Comparatively, 95.9% of Hilton Worldwide shares are owned by institutional investors. 9.9% of Meridian shares are owned by company insiders. Comparatively, 2.7% of Hilton Worldwide shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Summary

Hilton Worldwide beats Meridian on 12 of the 14 factors compared between the two stocks.

About Meridian

Meridian Holdings Inc is engaged in the online gaming and betting business, providing sports betting, online casino, and gaming operations across multiple jurisdictions in Europe, Africa, and Central and South America. The company has three reportable segments: MeridianBet Group, GMAG, and RKings & CFAC. The MeridianBet Group segment includes retail and online sports betting, casinos, and related gaming operations. The GMAG segment focuses on the resale of third-party gaming content, mainly serving customers in the Asia-Pacific region. The RKings & CFAC segment is involved in pay-to-enter prize competitions and trade promotions conducted in the United Kingdom and Australia. It generates the majority of its revenue from the MeridianBet Group segment.

About Hilton Worldwide

Hilton Worldwide Holdings Inc., a hospitality company, engages in managing, franchising, owning, and leasing hotels and resorts. It operates through two segments, Management and Franchise, and Ownership. The company engages in the hotel management and licensing of its brands. It operates luxury hotels under the Waldorf Astoria Hotels & Resorts, LXR Hotels & Resorts, and Conrad Hotels & Resorts brand; lifestyle hotels under the Canopy by Hilton, Curio Collection by Hilton, Tapestry Collection by Hilton, Tempo by Hilton, and Motto by Hilton brand; full service hotels under the Signia by Hilton, Hilton Hotels & Resorts, and DoubleTree by Hilton brand; service hotels under the Hilton Garden Inn, Hampton by Hilton, and Tru by Hilton brand; all-suite hotels under the Embassy Suites by Hilton, Homewood Suites by Hilton, and Home2 Suites by Hilton brand; and economy hotel under the Spark by Hilton brand, as well as Hilton Grand Vacations. The company operates in North America, South America, and Central America, including various Caribbean nations; Europe, the Middle East, and Africa; and the Asia Pacific. The company was founded in 1919 and is headquartered in McLean, Virginia.