Northstar Realty Europe (NYSE:NRE) and Pebblebrook Hotel Trust (NYSE:PEB) are both finance companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, valuation, risk, analyst recommendations, institutional ownership, earnings and profitability.

Insider and Institutional Ownership

68.4% of Northstar Realty Europe shares are held by institutional investors. 1.5% of Northstar Realty Europe shares are held by company insiders. Comparatively, 2.2% of Pebblebrook Hotel Trust shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Dividends

Northstar Realty Europe pays an annual dividend of $0.60 per share and has a dividend yield of 4.5%. Pebblebrook Hotel Trust pays an annual dividend of $1.52 per share and has a dividend yield of 4.2%. Pebblebrook Hotel Trust pays out 59.1% of its earnings in the form of a dividend. Pebblebrook Hotel Trust has raised its dividend for 5 consecutive years.

Volatility & Risk

Northstar Realty Europe has a beta of 1.01, indicating that its stock price is 1% more volatile than the S&P 500. Comparatively, Pebblebrook Hotel Trust has a beta of 1.25, indicating that its stock price is 25% more volatile than the S&P 500.

Profitability

This table compares Northstar Realty Europe and Pebblebrook Hotel Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Northstar Realty Europe 22.39% 8.27% 2.62%
Pebblebrook Hotel Trust 15.71% 7.99% 4.44%

Analyst Ratings

This is a breakdown of recent ratings and price targets for Northstar Realty Europe and Pebblebrook Hotel Trust, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Northstar Realty Europe 0 0 3 0 3.00
Pebblebrook Hotel Trust 0 3 3 0 2.50

Northstar Realty Europe presently has a consensus price target of $17.17, indicating a potential upside of 27.73%. Pebblebrook Hotel Trust has a consensus price target of $38.70, indicating a potential upside of 6.82%. Given Northstar Realty Europe’s stronger consensus rating and higher probable upside, research analysts clearly believe Northstar Realty Europe is more favorable than Pebblebrook Hotel Trust.

Valuation and Earnings

This table compares Northstar Realty Europe and Pebblebrook Hotel Trust’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Northstar Realty Europe $129.92 million 5.15 -$31.12 million N/A N/A
Pebblebrook Hotel Trust $769.32 million 3.25 $99.88 million $2.57 14.10

Pebblebrook Hotel Trust has higher revenue and earnings than Northstar Realty Europe.

Summary

Northstar Realty Europe beats Pebblebrook Hotel Trust on 8 of the 14 factors compared between the two stocks.

Northstar Realty Europe Company Profile

NorthStar Realty Europe Corp. is a European focused commercial real estate company with predominately prime office properties within key cities in Germany, the United Kingdom and France, organized as a REIT and managed by an affiliate of Colony Capital, Inc. (NYSE: CLNY), a leading global equity REIT with an embedded investment management platform.

Pebblebrook Hotel Trust Company Profile

Pebblebrook Hotel Trust is a publicly traded real estate investment trust (?REIT?) organized to opportunistically acquire and invest primarily in upper upscale, full-service hotels located in urban markets in major gateway cities. The Company owns 28 hotels, with a total of 6,973 guest rooms. The Company owns hotels located in 9 states and the District of Columbia, including: Los Angeles, California (Beverly Hills, Santa Monica and West Hollywood); San Diego, California; San Francisco, California; Washington, DC; Coral Gables, Florida; Naples, Florida; Buckhead, Georgia; Boston, Massachusetts; Minneapolis, Minnesota; Portland, Oregon; Philadelphia, Pennsylvania; Nashville, Tennessee; Columbia River Gorge, Washington; and Seattle, Washington.

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