Life Time Group (NYSE:LTH – Get Free Report) and McDonald’s (NYSE:MCD – Get Free Report) are both consumer discretionary companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, valuation, risk, earnings, analyst recommendations, dividends and institutional ownership.
Risk & Volatility
Life Time Group has a beta of 1.49, suggesting that its share price is 49% more volatile than the S&P 500. Comparatively, McDonald’s has a beta of 0.44, suggesting that its share price is 56% less volatile than the S&P 500.
Insider & Institutional Ownership
79.4% of Life Time Group shares are held by institutional investors. Comparatively, 70.3% of McDonald’s shares are held by institutional investors. 13.3% of Life Time Group shares are held by insiders. Comparatively, 0.3% of McDonald’s shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Profitability
This table compares Life Time Group and McDonald’s’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Life Time Group | 13.07% | 10.56% | 4.13% |
| McDonald’s | 31.72% | -572.06% | 14.92% |
Analyst Ratings
This is a breakdown of current recommendations and price targets for Life Time Group and McDonald’s, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Life Time Group | 0 | 0 | 13 | 2 | 3.13 |
| McDonald’s | 1 | 13 | 22 | 1 | 2.62 |
Life Time Group currently has a consensus target price of $55.31, indicating a potential upside of 36.72%. McDonald’s has a consensus target price of $295.94, indicating a potential upside of 21.79%. Given Life Time Group’s stronger consensus rating and higher possible upside, research analysts clearly believe Life Time Group is more favorable than McDonald’s.
Valuation & Earnings
This table compares Life Time Group and McDonald’s”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Life Time Group | $3.00 billion | 3.02 | $373.67 million | $1.84 | 21.98 |
| McDonald’s | $26.89 billion | 6.40 | $8.56 billion | $12.31 | 19.74 |
McDonald’s has higher revenue and earnings than Life Time Group. McDonald’s is trading at a lower price-to-earnings ratio than Life Time Group, indicating that it is currently the more affordable of the two stocks.
Summary
Life Time Group beats McDonald’s on 8 of the 15 factors compared between the two stocks.
About Life Time Group
Life Time Group Holdings, Inc. provides health, fitness, and wellness experiences to a community of individual members in the United States and Canada. It primarily engages in designing, building, and operating of sports and athletic, professional fitness, family recreation, and spa centers in a resort-like environment, principally in suburban and urban locations of metropolitan areas. The company also offers fitness floors with equipment, locker rooms, group fitness studios, indoor and outdoor pools, bistros, indoor and outdoor tennis courts, pickleball courts, basketball courts, LifeSpa, LifeCafe, and childcare and Kids Academy learning spaces. In addition, its Life Time Digital provides live streaming fitness classes, remote goal-based personal training, nutrition and weight loss support, curated award-winning health, and fitness and wellness content. The company is also involved in media activities, conducting athletic events, and provision of related services. It operates various centers, including ground leases. The company was formerly known as LTF Holdings, Inc. and changed its name to Life Time Group Holdings, Inc. in June 21, 2021. Life Time Group Holdings, Inc. was founded in 1992 and is headquartered in Chanhassen, Minnesota.
About McDonald’s
McDonald’s Corp. engages in the operation and franchising of restaurants. It operates through the following segments: U.S., International Operated Markets, and International Developmental Licensed Markets and Corporate. The U.S. segment focuses its operations on the United States. The International Operated Markets segment consists of operations and the franchising of restaurants in Australia, Canada, France, Germany, Italy, the Netherlands, Spain, and the U.K. The International Developmental Licensed Markets and Corporate segment consists of developmental licensee and affiliate markets in the McDonald’s system. The firm’s products include Big Mac, Quarter Pounder with Cheese, Filet-O-Fish, several chicken sandwiches, Chicken McNuggets, wraps, McDonald’s Fries, salads, oatmeal, shakes, McFlurry desserts, sundaes, soft serve cones, pies, soft drinks, coffee, McCafe beverages, and other beverages. The company was founded by Raymond Albert Kroc on April 15, 1955, and is headquartered in Oak Brook, IL.
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