Chatham Lodging Trust (NYSE:CLDT) versus BRAEMAR HOTELS & RESORTS (NYSE:BHR) Financial Analysis

BRAEMAR HOTELS & RESORTS (NYSE:BHR) and Chatham Lodging Trust (NYSE:CLDT) are both small-cap real estate companies, but which is the better stock? We will compare the two businesses based on the strength of their earnings, dividends, analyst recommendations, valuation, profitability, risk and institutional ownership.

Volatility and Risk

BRAEMAR HOTELS & RESORTS has a beta of 0.8, meaning that its share price is 20% less volatile than the S&P 500. Comparatively, Chatham Lodging Trust has a beta of 1.08, meaning that its share price is 8% more volatile than the S&P 500.

Profitability

This table compares BRAEMAR HOTELS & RESORTS and Chatham Lodging Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
BRAEMAR HOTELS & RESORTS	-0.45%	-1.92%	-0.17%
Chatham Lodging Trust	4.00%	1.56%	1.00%

Dividends

BRAEMAR HOTELS & RESORTS pays an annual dividend of $0.20 per share and has a dividend yield of 9.7%. Chatham Lodging Trust pays an annual dividend of $0.40 per share and has a dividend yield of 2.9%. BRAEMAR HOTELS & RESORTS pays out -27.4% of its earnings in the form of a dividend. Chatham Lodging Trust pays out 500.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Chatham Lodging Trust has raised its dividend for 2 consecutive years. BRAEMAR HOTELS & RESORTS is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider & Institutional Ownership

64.8% of BRAEMAR HOTELS & RESORTS shares are owned by institutional investors. Comparatively, 88.4% of Chatham Lodging Trust shares are owned by institutional investors. 8.2% of BRAEMAR HOTELS & RESORTS shares are owned by company insiders. Comparatively, 8.1% of Chatham Lodging Trust shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares BRAEMAR HOTELS & RESORTS and Chatham Lodging Trust”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
BRAEMAR HOTELS & RESORTS	$689.13 million	0.20	-$22.32 million	($0.73)	-2.82
Chatham Lodging Trust	$295.08 million	2.16	$15.05 million	$0.08	170.86

Chatham Lodging Trust has lower revenue, but higher earnings than BRAEMAR HOTELS & RESORTS. BRAEMAR HOTELS & RESORTS is trading at a lower price-to-earnings ratio than Chatham Lodging Trust, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for BRAEMAR HOTELS & RESORTS and Chatham Lodging Trust, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
BRAEMAR HOTELS & RESORTS	1	2	0	0	1.67
Chatham Lodging Trust	0	3	2	0	2.40

BRAEMAR HOTELS & RESORTS presently has a consensus target price of $2.50, suggesting a potential upside of 21.65%. Chatham Lodging Trust has a consensus target price of $13.00, suggesting a potential downside of 4.89%. Given BRAEMAR HOTELS & RESORTS’s higher probable upside, analysts plainly believe BRAEMAR HOTELS & RESORTS is more favorable than Chatham Lodging Trust.

Summary

Chatham Lodging Trust beats BRAEMAR HOTELS & RESORTS on 12 of the 17 factors compared between the two stocks.

About BRAEMAR HOTELS & RESORTS

Braemar Hotels & Resorts is a conservatively capitalized REIT that invests primarily in high RevPAR, full-service luxury hotels and resorts. We are listed on the New York Stock Exchange under the symbol BHR and are externally-advised by Ashford (NYSE American: AINC).

About Chatham Lodging Trust

Chatham Lodging Trust is a self-advised, publicly traded real estate investment trust (REIT) focused primarily on investing in upscale, extended-stay hotels and premium-branded, select-service hotels. The company owns 39 hotels totaling 5,915 rooms/suites in 16 states and the District of Columbia.