Marriott Vacations Worldwide (NYSE: VAC) and Realogy (NYSE:RLGY) are both mid-cap consumer discretionary companies, but which is the superior business? We will compare the two businesses based on the strength of their valuation, institutional ownership, dividends, risk, earnings, analyst recommendations and profitability.
This table compares Marriott Vacations Worldwide and Realogy’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Marriott Vacations Worldwide||11.25%||16.31%||6.02%|
Insider & Institutional Ownership
72.7% of Marriott Vacations Worldwide shares are owned by institutional investors. 3.5% of Marriott Vacations Worldwide shares are owned by insiders. Comparatively, 0.8% of Realogy shares are owned 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.
Valuation and Earnings
This table compares Marriott Vacations Worldwide and Realogy’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Marriott Vacations Worldwide||$1.95 billion||1.54||$226.77 million||$5.78||19.54|
|Realogy||$6.11 billion||0.48||$431.00 million||$1.57||14.52|
Realogy has higher revenue and earnings than Marriott Vacations Worldwide. Realogy is trading at a lower price-to-earnings ratio than Marriott Vacations Worldwide, indicating that it is currently the more affordable of the two stocks.
This is a summary of recent ratings for Marriott Vacations Worldwide and Realogy, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Marriott Vacations Worldwide||0||2||8||0||2.80|
Marriott Vacations Worldwide currently has a consensus target price of $140.70, indicating a potential upside of 24.56%. Realogy has a consensus target price of $32.88, indicating a potential upside of 44.19%. Given Realogy’s higher probable upside, analysts clearly believe Realogy is more favorable than Marriott Vacations Worldwide.
Marriott Vacations Worldwide pays an annual dividend of $1.60 per share and has a dividend yield of 1.4%. Realogy pays an annual dividend of $0.36 per share and has a dividend yield of 1.6%. Marriott Vacations Worldwide pays out 27.7% of its earnings in the form of a dividend. Realogy pays out 22.9% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Marriott Vacations Worldwide has raised its dividend for 3 consecutive years. Realogy is clearly the better dividend stock, given its higher yield and lower payout ratio.
Risk and Volatility
Marriott Vacations Worldwide has a beta of 1.33, meaning that its stock price is 33% more volatile than the S&P 500. Comparatively, Realogy has a beta of 1.15, meaning that its stock price is 15% more volatile than the S&P 500.
Marriott Vacations Worldwide beats Realogy on 12 of the 17 factors compared between the two stocks.
Marriott Vacations Worldwide Company Profile
Marriott Vacations Worldwide Corporation develops, markets, sells, and manages vacation ownership and related products under the Marriott Vacation Club, Grand Residences by Marriott, and Marriott Vacation Club Pulse brands. It operates through three segments: North America, Asia Pacific, and Europe. The company also develops, markets, and sells vacation ownership and related products under The Ritz-Carlton Destination Club brand; and holds right to develop, market, and sell ownership residential products under The Ritz-Carlton Residences brand. In addition, it sells two points-based vacation ownership products through Marriott Vacation Club points-based ownership programs focused in North America and the Asia Pacific; and weeks-based vacation ownership products. Further, it is involved in financing consumer purchases of vacation ownership products; and renting vacation ownership inventory. Additionally, the company provides on-site management and services, such as daily housekeeping services, valet, in-residence dining, and access to fitness facilities, as well as spa and sports facilities for Ritz-Carlton branded properties. As of December 30, 2017, Marriott Vacations Worldwide Corporation operated 65 properties with 13,654 vacation ownership villas and approximately 400,000 owners in the United States, and 9 other countries and territories. It sells its upscale tier vacation ownership products primarily through a network of resort-based sales centers and off-site sales locations. Marriott Vacations Worldwide Corporation is headquartered in Orlando, Florida.
Realogy Company Profile
Realogy Holdings Corp. is an integrated provider of residential real estate services in the United States. The Company is the franchisor of residential real estate brokerages with some of the recognized brands in the real estate industry, the owner of United States residential real estate brokerage offices, the global provider of outsourced employee relocation services and a provider of title and settlement services. The Company’s operating platform is supported by the Company’s portfolio of industry franchise brokerage brands, including Century 21 , Coldwell Banker , Coldwell Banker Commercial , ERA , Sotheby’s International Realty and Better Homes and Gardens Real Estate and the Company also owns and operates the Corcoran Group and CitiHabitats brands. On August 14, 2014, Realogy Holdings Corp, through its Realogy Group LLC wholly owned subsidiary, acquired ZipRealty Inc (ZipRealty).
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