Financial Comparison: Summit Hotel Properties (INN) versus Its Competitors
Summit Hotel Properties (NYSE: INN) is one of 28 publicly-traded companies in the “Hospitality REITs” industry, but how does it compare to its peers? We will compare Summit Hotel Properties to related businesses based on the strength of its dividends, valuation, risk, analyst recommendations, institutional ownership, earnings and profitability.
Summit Hotel Properties pays an annual dividend of $0.68 per share and has a dividend yield of 4.4%. Summit Hotel Properties pays out 75.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Hospitality REITs” companies pay a dividend yield of 5.5% and pay out 135.4% of their earnings in the form of a dividend. Summit Hotel Properties has increased its dividend for 3 consecutive years.
This table compares Summit Hotel Properties and its peers’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Summit Hotel Properties||21.97%||9.89%||5.83%|
|Summit Hotel Properties Competitors||8.99%||3.14%||2.47%|
Insider & Institutional Ownership
95.3% of Summit Hotel Properties shares are owned by institutional investors. Comparatively, 77.4% of shares of all “Hospitality REITs” companies are owned by institutional investors. 1.7% of Summit Hotel Properties shares are owned by company insiders. Comparatively, 5.4% of shares of all “Hospitality REITs” companies are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
This is a breakdown of recent ratings for Summit Hotel Properties and its peers, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Summit Hotel Properties||1||2||5||0||2.50|
|Summit Hotel Properties Competitors||234||932||901||20||2.34|
Summit Hotel Properties presently has a consensus price target of $17.50, indicating a potential upside of 13.93%. As a group, “Hospitality REITs” companies have a potential upside of 5.84%. Given Summit Hotel Properties’ stronger consensus rating and higher probable upside, analysts plainly believe Summit Hotel Properties is more favorable than its peers.
Risk & Volatility
Summit Hotel Properties has a beta of 1.2, meaning that its stock price is 20% more volatile than the S&P 500. Comparatively, Summit Hotel Properties’ peers have a beta of 1.00, meaning that their average stock price is 0% more volatile than the S&P 500.
Earnings and Valuation
This table compares Summit Hotel Properties and its peers revenue, earnings per share and valuation.
|Gross Revenue||EBITDA||Price/Earnings Ratio|
|Summit Hotel Properties||$475.70 million||$154.58 million||17.07|
|Summit Hotel Properties Competitors||$1.10 billion||$338.64 million||-15.46|
Summit Hotel Properties’ peers have higher revenue and earnings than Summit Hotel Properties. Summit Hotel Properties is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.
Summit Hotel Properties beats its peers on 10 of the 15 factors compared.
About Summit Hotel Properties
Summit Hotel Properties, Inc. is a real estate investment trust (REIT). The Company is focused primarily on owning premium-branded, select-service hotels in the Upscale segment of the United States lodging industry. The Company’s portfolio consists of 79 hotels with a total of 11,590 guestrooms located in 24 states. The Company’s hotels are located in markets, such as business and corporate headquarters, retail centers, airports and tourist attractions. The Company’s portfolio is located in urban and suburban markets. Based on total number of guestrooms, approximately 92% of the Company’s portfolio is positioned in over 50 metropolitan statistical areas (MSAs), and approximately 96% is located within over 100 MSAs. Based on total number of guestrooms, approximately 99% of the Company’s hotels operate under franchise brands owned by Marriott International, Inc., Hilton Worldwide, InterContinental Hotels Group, and an affiliate of Hyatt Hotels Corporation.
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