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 $2.6B against $2.1B — 1.2× the size. DiamondRock Hospitality Company trades at the lower P/E: 17.1× against 50.9×. Sunstone Hotel Investors, Inc. grew revenue faster over the last twelve months: 7.28% against 1.03%. DiamondRock Hospitality Company has the higher net margin (13.1% vs 4.21%) and the higher return on invested capital (4.62% vs 2.16%). Both pay a dividend; Sunstone Hotel Investors, Inc. yields more (2.43% vs 1.40%). Across the 22 metrics below, DiamondRock Hospitality Company leads on 13 and Sunstone Hotel Investors, Inc. on 9.

Valuation

Metric DRH SHO Reit Hotel & Motel median
P/E 17.14 50.86 25.03
P/S 2.26 2.07 1.53
P/B 1.68 1.27 1.05
Price to free cash flow 13.27 19.91 7.25
EV/EBITDA 11.74 11.76 11.74
EV/Sales 3.10 2.83 2.64
Earnings yield 5.84% 1.97% (0.39%)
Free cash flow yield 7.53% 5.02% 7.53%

Profitability

Metric DRH SHO Reit Hotel & Motel median
Gross margin 37.37% 63.41% 37.37%
Operating margin 16.16% 9.12% 9.53%
Net margin 13.09% 4.21% (0.66%)
Free cash flow margin 17.01% 9.65% 17.01%
Return on equity 9.56% 2.53% 0.53%
Return on assets 4.86% 1.40% (0.26%)
Return on invested capital 4.62% 2.16% 2.16%

Growth

Metric DRH SHO Reit Hotel & Motel median
Revenue growth (TTM) 1.03% 7.28% 1.17%
EPS growth (last fiscal year) 144.44% (71.43%) —
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 0.72 0.51 0.83
Current ratio 1.87 3.84 1.34
Net debt to EBITDA 3.59 3.29 5.14

Dividend

Metric DRH SHO Reit Hotel & Motel median
Dividend yield 1.40% 2.43% 3.10%
Payout ratio 0.30 0.48 0.48

Size

Metric DRH SHO Reit Hotel & Motel median
Market cap 2.55b 2.07b 1.70b

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