Town Sports International Holdings (NASDAQ: CLUB) and Planet Fitness (NYSE:PLNT) are both consumer discretionary companies, but which is the better stock? We will compare the two businesses based on the strength of their analyst recommendations, valuation, earnings, dividends, institutional ownership, risk and profitabiliy.
Insider & Institutional Ownership
49.2% of Town Sports International Holdings shares are owned by institutional investors. Comparatively, 94.6% of Planet Fitness shares are owned by institutional investors. 19.0% of Town Sports International Holdings shares are owned by insiders. Comparatively, 19.9% of Planet Fitness shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
Analyst Recommendations
This is a breakdown of recent ratings for Town Sports International Holdings and Planet Fitness, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Town Sports International Holdings | 0 | 0 | 0 | 0 | N/A |
| Planet Fitness | 0 | 1 | 9 | 0 | 2.90 |
Planet Fitness has a consensus target price of $25.10, indicating a potential upside of 10.04%. Given Planet Fitness’ higher possible upside, analysts clearly believe Planet Fitness is more favorable than Town Sports International Holdings.
Earnings & Valuation
This table compares Town Sports International Holdings and Planet Fitness’ top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | EBITDA | Earnings Per Share | Price/Earnings Ratio | |
| Town Sports International Holdings | $394.66 million | 0.31 | $42.51 million | $0.46 | 10.65 |
| Planet Fitness | $386.00 million | 4.29 | $153.88 million | $0.51 | 44.73 |
Planet Fitness has higher revenue, but lower earnings than Town Sports International Holdings. Town Sports International Holdings is trading at a lower price-to-earnings ratio than Planet Fitness, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Town Sports International Holdings and Planet Fitness’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Town Sports International Holdings | 3.05% | N/A | -4.75% |
| Planet Fitness | 6.99% | -79.66% | 7.47% |
Risk and Volatility
Town Sports International Holdings has a beta of 2.98, indicating that its stock price is 198% more volatile than the S&P 500. Comparatively, Planet Fitness has a beta of 0.93, indicating that its stock price is 7% less volatile than the S&P 500.
Summary
Planet Fitness beats Town Sports International Holdings on 9 of the 12 factors compared between the two stocks.
About Town Sports International Holdings
Town Sports International Holdings, Inc. is an owner and operator of fitness clubs in the Northeast and Mid-Atlantic regions of the United States fitness. As of December 31, 2016, the Company, through its subsidiaries, operated 150 fitness clubs (clubs). It owned and operated a total of 102 clubs under the New York Sports Clubs (NYSC) brand name within a 120-mile radius of New York City as of December 31, 2016, including 35 locations in Manhattan. It owned and operated 28 clubs in the Boston region under its Boston Sports Clubs (BSC) brand name, 12 clubs (one of which is partly-owned) in the Washington, D.C. region under its Washington Sports Clubs (WSC) brand name and five clubs in the Philadelphia region under its Philadelphia Sports Clubs (PSC) brand name as of December 31, 2016. In addition, as of December 31, 2016, it owned and operated three clubs in Switzerland and partly-owned one club that operated under a different brand name in Washington, D.C.
About Planet Fitness
Planet Fitness, Inc. is a franchisor and operator of fitness centers in the United States. The Company operates through three segments: Franchise; Corporate-owned stores, and Equipment. The Franchise segment includes operations related to the Company’s franchising business in the United States, Puerto Rico, the Dominican Republic and Canada. The Corporate-owned stores segment includes operations with respect to all corporate-owned stores throughout the United States and Canada. The Equipment segment includes the sale of equipment to franchisee-owned stores. As of December 31, 2016, it had approximately 8.9 million members and 1,313 stores in 48 states, the District of Columbia, Puerto Rico, Canada and the Dominican Republic. Of its 1,313 stores, 1,255 were franchised and 58 are corporate-owned, as of December 31, 2016.
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