Reviewing Super Group (SGHC) (NYSE:SGHC) and PENN Entertainment (NASDAQ:PENN)

PENN Entertainment (NASDAQ:PENN) and Super Group (SGHC) (NYSE:SGHC) are both mid-cap consumer discretionary companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, valuation, risk, dividends, analyst recommendations, institutional ownership and earnings.

Volatility and Risk

PENN Entertainment has a beta of 1.43, suggesting that its stock price is 43% more volatile than the S&P 500. Comparatively, Super Group (SGHC) has a beta of 1.11, suggesting that its stock price is 11% more volatile than the S&P 500.

Insider & Institutional Ownership

91.7% of PENN Entertainment shares are held by institutional investors. Comparatively, 5.1% of Super Group (SGHC) shares are held by institutional investors. 2.7% of PENN Entertainment shares are held by insiders. Comparatively, 10.4% of Super Group (SGHC) shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares PENN Entertainment and Super Group (SGHC)”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
PENN Entertainment	$6.96 billion	0.34	-$843.10 million	($6.72)	-2.67
Super Group (SGHC)	$2.33 billion	2.79	$217.00 million	$0.48	26.70

Super Group (SGHC) has lower revenue, but higher earnings than PENN Entertainment. PENN Entertainment is trading at a lower price-to-earnings ratio than Super Group (SGHC), indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of current ratings and target prices for PENN Entertainment and Super Group (SGHC), as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
PENN Entertainment	1	6	8	0	2.47
Super Group (SGHC)	0	2	7	0	2.78

PENN Entertainment presently has a consensus target price of $20.29, suggesting a potential upside of 13.21%. Super Group (SGHC) has a consensus target price of $17.57, suggesting a potential upside of 37.13%. Given Super Group (SGHC)’s stronger consensus rating and higher probable upside, analysts plainly believe Super Group (SGHC) is more favorable than PENN Entertainment.

Profitability

This table compares PENN Entertainment and Super Group (SGHC)’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
PENN Entertainment	-13.55%	0.44%	0.07%
Super Group (SGHC)	10.58%	42.85%	26.15%

Summary

Super Group (SGHC) beats PENN Entertainment on 10 of the 14 factors compared between the two stocks.

About PENN Entertainment

PENN Entertainment, Inc., together with its subsidiaries, provides integrated entertainment, sports content, and casino gaming experiences. The company operates through five segments: Northeast, South, West, Midwest, and Interactive. It operates online sports betting in various jurisdictions; and iCasino under Hollywood Casino, L'Auberge, ESPN BET, and theScore Bet Sportsbook and Casino brands. The company's portfolio also includes PENN Play, customer loyalty program, which offers a set of rewards and experiences for business channels. In addition, it owns various trademarks and service marks, including Ameristar, Argosy, Boomtown, Hollywood Casino, Hollywood Gaming, L'Auberge, PENN Play, theScore, theScore Bet, theScore esports, and M Resort. The company was formerly known as Penn National Gaming, Inc. and changed its name to PENN Entertainment, Inc. in August 2022. PENN Entertainment, Inc. was founded in 1972 and is based in Wyomissing, Pennsylvania.

About Super Group (SGHC)

Super Group (SGHC) Limited operates as an online sports betting and gaming operator. It offers Betway, an online sports betting brand; and Spin, a multi-brand online casino offering. Super Group (SGHC) Limited is based in Saint Peter Port, Guernsey.