Sunstone Hotel Investors, Inc. (SHO) vs Service Properties Trust (SVC)

Sunstone Hotel Investors, Inc. and Service Properties Trust are both Reit Hotel & Motel companies. Sunstone Hotel Investors, Inc. is the larger, with a market value of $2.2B against $801.7M — 2.8× the size. Service Properties Trust has negative trailing earnings, so its P/E is not meaningful; Sunstone Hotel Investors, Inc. trades at 53.8×. Sunstone Hotel Investors, Inc. grew revenue faster over the last twelve months: 7.28% against −11.9%. Sunstone Hotel Investors, Inc. has the higher net margin (4.21% vs −25.4%) and the higher return on invested capital (2.16% vs −1.68%). Both pay a dividend; Service Properties Trust yields more (4.07% vs 3.04%). Across the 21 metrics below, Sunstone Hotel Investors, Inc. leads on 12 and Service Properties Trust on 9.

Valuation

Metric SHO SVC Reit Hotel & Motel median
P/E 53.77 n/m 26.14
P/S 2.19 0.47 1.47
P/B 1.34 0.98 1.05
Price to free cash flow 21.05 1.15 7.55
EV/EBITDA 12.25 8.13 12.25
EV/Sales 2.95 1.48 2.83
Earnings yield 1.86% (125.20%) (0.37%)
Free cash flow yield 4.75% 86.68% 7.02%

Profitability

Metric SHO SVC Reit Hotel & Motel median
Gross margin 63.41% 33.86% 37.37%
Operating margin 9.12% (4.01%) 9.53%
Net margin 4.21% (25.44%) (0.66%)
Free cash flow margin 9.65% 41.09% 17.01%
Return on equity 2.53% (56.28%) 0.53%
Return on assets 1.40% (6.62%) (0.26%)
Return on invested capital 2.16% (1.68%) 2.16%

Growth

Metric SHO SVC Reit Hotel & Motel median
Revenue growth (TTM) 7.28% (11.91%) 1.17%
EPS growth (last fiscal year) (71.43%) 26.95% (16.85%)
Revenue growth, 5-year CAGR 29.08% 7.48% 24.43%
Net income growth, 5-year CAGR 0.00% 0.00% 0.00%

Health

Metric SHO SVC Reit Hotel & Motel median
Debt to equity 0.51 2.11 0.83
Current ratio 3.84 0.01 1.34
Net debt to EBITDA 3.29 6.01 5.14

Dividend

Metric SHO SVC Reit Hotel & Motel median
Dividend yield 3.04% 4.07% 3.15%
Payout ratio 1.64 — 1.24

Size

Metric SHO SVC Reit Hotel & Motel median
Market cap 2.21b 801.66m 1.78b

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