Critical Comparison: Dover Motorsports (DVD) and Live Nation Entertainment (LYV)

Dover Motorsports (NYSE: DVD) and Live Nation Entertainment (NYSE:LYV) are both consumer discretionary companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, risk, analyst recommendations, institutional ownership, dividends, valuation and profitability.

Dividends

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Dover Motorsports pays an annual dividend of $0.08 per share and has a dividend yield of 3.9%. Live Nation Entertainment does not pay a dividend. Dover Motorsports pays out 80.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Profitability

This table compares Dover Motorsports and Live Nation Entertainment’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Dover Motorsports 18.03% 7.31% 4.71%
Live Nation Entertainment -0.24% -1.71% -0.32%

Insider and Institutional Ownership

24.6% of Dover Motorsports shares are held by institutional investors. Comparatively, 69.1% of Live Nation Entertainment shares are held by institutional investors. 50.0% of Dover Motorsports shares are held by insiders. Comparatively, 4.8% of Live Nation Entertainment shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Volatility & Risk

Dover Motorsports has a beta of 0.37, meaning that its share price is 63% less volatile than the S&P 500. Comparatively, Live Nation Entertainment has a beta of 0.97, meaning that its share price is 3% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current recommendations for Dover Motorsports and Live Nation Entertainment, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Dover Motorsports 0 0 1 0 3.00
Live Nation Entertainment 0 2 6 0 2.75

Live Nation Entertainment has a consensus price target of $49.33, indicating a potential upside of 30.68%. Given Live Nation Entertainment’s higher probable upside, analysts clearly believe Live Nation Entertainment is more favorable than Dover Motorsports.

Valuation & Earnings

This table compares Dover Motorsports and Live Nation Entertainment’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Dover Motorsports $46.74 million 1.61 $8.42 million $0.10 20.50
Live Nation Entertainment $10.34 billion 0.76 -$97.64 million ($0.48) -78.65

Dover Motorsports has higher earnings, but lower revenue than Live Nation Entertainment. Live Nation Entertainment is trading at a lower price-to-earnings ratio than Dover Motorsports, indicating that it is currently the more affordable of the two stocks.

Summary

Dover Motorsports beats Live Nation Entertainment on 9 of the 15 factors compared between the two stocks.

Dover Motorsports Company Profile

Dover Motorsports, Inc. markets and promotes motorsports entertainment in the United States. It owns and operates Dover International Speedway in Dover, Delaware; and Nashville Superspeedway near Nashville, Tennessee. The company was formerly known as Dover Downs Entertainment, Inc. Dover Motorsports, Inc. was founded in 1969 and is based in Dover, Delaware.

Live Nation Entertainment Company Profile

Live Nation Entertainment, Inc. is a live entertainment company. The Company’s businesses consist of the promotion of live events, including ticketing, sponsorship and advertising. Its segments include Concerts, Sponsorship & Advertising, Ticketing and Artist Nation. The Concerts segment is engaged in promotion of live music events in its owned or operated venues and in rented third-party venues; operation and management of music venues; production of music festivals, and creation of associated content. The Ticketing segment is an agency business that sells tickets for events on behalf of its clients. The Artist Nation segment provides management services to music artists in exchange for a commission on the earnings of artists. The Sponsorship & Advertising segment employs sales force that creates and maintains relationships with sponsors to allow businesses to reach customers through its concert, venue, artist relationship and ticketing assets, including advertising on its Websites.

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