DiamondRock Hospitality Company (DRH) vs Sunstone Hotel Investors, Inc. (SHO)

DiamondRock Hospitality Company and Sunstone Hotel Investors, Inc. are both Reit Hotel & Motel companies. DiamondRock Hospitality Company is the larger, with a market value of $2.9B against $2.3B — 1.2× the size. DiamondRock Hospitality Company trades at the lower P/E: 17.7× against 27.7×. Sunstone Hotel Investors, Inc. grew revenue faster over the last twelve months: 7.42% against 2.10%. DiamondRock Hospitality Company has the higher net margin (14.1% vs 8.32%) and the higher return on invested capital (4.84% vs 2.52%). Both pay a dividend; Sunstone Hotel Investors, Inc. yields more (2.89% vs 2.07%). Across the 22 metrics below, DiamondRock Hospitality Company leads on 12 and Sunstone Hotel Investors, Inc. on 10.

Valuation

Metric DRH SHO Reit Hotel & Motel median
P/E 17.68 27.67 28.97
P/S 2.50 2.24 1.57
P/B 1.86 1.38 1.22
Price to free cash flow 14.97 21.83 7.89
EV/EBITDA 12.36 11.96 11.96
EV/Sales 3.30 2.86 2.84
Earnings yield 5.65% 3.61% 0.18%
Free cash flow yield 6.68% 4.58% 6.68%

Profitability

Metric DRH SHO Reit Hotel & Motel median
Gross margin 37.56% 0.00% 32.55%
Operating margin 16.63% 9.66% 9.93%
Net margin 14.11% 8.32% 0.34%
Free cash flow margin 16.73% 19.63% 19.63%
Return on equity 10.37% 0.00% 0.59%
Return on assets 5.19% 2.82% 0.14%
Return on invested capital 4.84% 2.52% 2.34%

Growth

Metric DRH SHO Reit Hotel & Motel median
Revenue growth (TTM) 2.10% 7.42% 2.76%
EPS growth (last fiscal year) 144.44% (71.43%) (16.85%)
Revenue growth, 5-year CAGR 30.20% 29.08% 24.43%
Net income growth, 5-year CAGR 0.00% 0.00% 0.00%

Health

Metric DRH SHO Reit Hotel & Motel median
Debt to equity 0.71 0.53 0.80
Current ratio 1.96 3.84 1.15
Net debt to EBITDA 3.59 3.29 5.14

Dividend

Metric DRH SHO Reit Hotel & Motel median
Dividend yield 2.07% 2.89% 3.05%
Payout ratio 0.37 0.80 1.19

Size

Metric DRH SHO Reit Hotel & Motel median
Market cap 2.87b 2.30b 1.96b

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