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 $2.3B against $712.3M — 3.2× the size. Service Properties Trust has negative trailing earnings, so its P/E is not meaningful; Sunstone Hotel Investors, Inc. trades at 27.7×. Sunstone Hotel Investors, Inc. grew revenue faster over the last twelve months: 7.42% against −15.6%. Sunstone Hotel Investors, Inc. has the higher net margin (8.32% vs −29.3%) and the higher return on invested capital (2.52% vs −2.57%). Both pay a dividend; Service Properties Trust yields more (3.83% vs 2.89%). Across the 21 metrics below, Sunstone Hotel Investors, Inc. leads on 11 and Service Properties Trust on 10.

Valuation

Metric SHO SVC Reit Hotel & Motel median
P/E 27.67 n/m 28.97
P/S 2.24 0.43 1.57
P/B 1.38 0.95 1.22
Price to free cash flow 21.83 1.41 7.89
EV/EBITDA 11.96 8.27 11.96
EV/Sales 2.86 1.46 2.84
Earnings yield 3.61% (133.72%) 0.18%
Free cash flow yield 4.58% 70.98% 6.68%

Profitability

Metric SHO SVC Reit Hotel & Motel median
Gross margin 0.00% 35.13% 32.55%
Operating margin 9.66% (6.12%) 9.93%
Net margin 8.32% (29.31%) 0.34%
Free cash flow margin 19.63% 30.27% 19.63%
Return on equity 0.00% (68.16%) 0.59%
Return on assets 2.82% (7.30%) 0.14%
Return on invested capital 2.52% (2.57%) 2.34%

Growth

Metric SHO SVC Reit Hotel & Motel median
Revenue growth (TTM) 7.42% (15.56%) 2.76%
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 0.53 2.39 0.80
Current ratio 3.84 0.02 1.15
Net debt to EBITDA 3.29 6.01 5.14

Dividend

Metric SHO SVC Reit Hotel & Motel median
Dividend yield 2.89% 3.83% 3.05%
Payout ratio 0.80 — 1.19

Size

Metric SHO SVC Reit Hotel & Motel median
Market cap 2.30b 712.30m 1.96b

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