Head to Head Contrast: Playags (AGS) versus AMC Entertainment (AMC)

Playags (NYSE: AGS) and AMC Entertainment (NYSE:AMC) are both consumer discretionary companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, profitability, institutional ownership, earnings, valuation, dividends and analyst recommendations.

Dividends

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AMC Entertainment pays an annual dividend of $0.80 per share and has a dividend yield of 4.9%. Playags does not pay a dividend. AMC Entertainment pays out -89.9% of its earnings in the form of a dividend.

Institutional & Insider Ownership

43.8% of AMC Entertainment shares are held by institutional investors. 0.8% of AMC Entertainment shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Playags and AMC Entertainment’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Playags N/A N/A N/A
AMC Entertainment -9.59% -6.04% -1.47%

Valuation and Earnings

This table compares Playags and AMC Entertainment’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Playags $211.96 million 3.65 -$45.10 million ($1.94) -11.34
AMC Entertainment $5.08 billion 0.41 -$487.20 million ($0.89) -18.48

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

Analyst Recommendations

This is a summary of recent ratings and price targets for Playags and AMC Entertainment, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Playags 0 1 4 0 2.80
AMC Entertainment 1 4 8 0 2.54

Playags currently has a consensus price target of $24.25, suggesting a potential upside of 10.28%. AMC Entertainment has a consensus price target of $23.68, suggesting a potential upside of 43.96%. Given AMC Entertainment’s higher probable upside, analysts clearly believe AMC Entertainment is more favorable than Playags.

Summary

AMC Entertainment beats Playags on 8 of the 15 factors compared between the two stocks.

Playags Company Profile

PlayAGS, Inc. is a designer and supplier of EGMs and other products and services for the gaming industry. The Company is focused on supplying electronic gaming machines (EGMs), including slot machines, video bingo machines, and other electronic gaming devices, to the Native American gaming market. Its product line-up to include Class III EGMs for commercial and Native American casinos permitted to operate Class III EGMs, table game products and interactive products. The Company’s EGM segment delivers on several EGM cabinets, including ICON, Orion, and Big Red/Colossal Diamonds. It has also developed a new Latin-style bingo cabinet called ALORA, which is used in select international markets, including the Philippines and Brazil.

AMC Entertainment Company Profile

AMC Entertainment Holdings, Inc. is a holding company. The Company, through its subsidiaries, including AMC Entertainment Inc. (AMCE), American Multi-Cinema, Inc. (OpCo) and its subsidiaries, is engaged in the theatrical exhibition business. It operates through theatrical exhibition operations segment. It licenses first-run motion pictures from distributors owned by film production companies and from independent distributors. The Company also offers a range of food and beverage items, which include popcorn; soft drinks; candy; hot dogs; specialty drinks, including beers, wine and mixed drinks, and made to order hot foods, including menu choices, such as curly fries, chicken tenders and mozzarella sticks. It operates over 900 theatres with approximately 10,000 screens globally, including over 661 theatres with approximately 8,200 screens in the United States and over 244 theatres with approximately 2,200 screens in Europe. The Company’s subsidiary also includes Carmike Cinemas, Inc.

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