RLJ Lodging Trust (NYSE: RLJ) and Hospitality Properties Trust (NASDAQ:HPT) are both mid-cap finance companies, but which is the superior investment? We will compare the two companies based on the strength of their risk, analyst recommendations, valuation, profitability, dividends, institutional ownership and earnings.

Profitability

This table compares RLJ Lodging Trust and Hospitality Properties Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
RLJ Lodging Trust 16.12% 8.16% 4.52%
Hospitality Properties Trust 10.22% 7.53% 3.16%

Insider & Institutional Ownership

76.3% of Hospitality Properties Trust shares are owned by institutional investors. 2.3% of RLJ Lodging Trust shares are owned by insiders. Comparatively, 1.7% of Hospitality Properties Trust shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Volatility and Risk

RLJ Lodging Trust has a beta of 1.17, suggesting that its share price is 17% more volatile than the S&P 500. Comparatively, Hospitality Properties Trust has a beta of 1.02, suggesting that its share price is 2% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent recommendations for RLJ Lodging Trust and Hospitality Properties Trust, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
RLJ Lodging Trust 2 3 6 0 2.36
Hospitality Properties Trust 0 3 4 0 2.57

RLJ Lodging Trust currently has a consensus price target of $24.09, indicating a potential upside of 9.50%. Hospitality Properties Trust has a consensus price target of $32.33, indicating a potential upside of 13.49%. Given Hospitality Properties Trust’s stronger consensus rating and higher probable upside, analysts plainly believe Hospitality Properties Trust is more favorable than RLJ Lodging Trust.

Valuation & Earnings

This table compares RLJ Lodging Trust and Hospitality Properties Trust’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
RLJ Lodging Trust $1.12 billion 2.43 $355.90 million $1.45 15.17
Hospitality Properties Trust $2.08 billion 2.25 $749.37 million $1.18 24.14

Hospitality Properties Trust has higher revenue and earnings than RLJ Lodging Trust. RLJ Lodging Trust is trading at a lower price-to-earnings ratio than Hospitality Properties Trust, indicating that it is currently the more affordable of the two stocks.

Dividends

RLJ Lodging Trust pays an annual dividend of $0.44 per share and has a dividend yield of 2.0%. Hospitality Properties Trust pays an annual dividend of $2.08 per share and has a dividend yield of 7.3%. RLJ Lodging Trust pays out 30.3% of its earnings in the form of a dividend. Hospitality Properties Trust pays out 176.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. RLJ Lodging Trust has increased its dividend for 6 consecutive years.

Summary

RLJ Lodging Trust beats Hospitality Properties Trust on 11 of the 17 factors compared between the two stocks.

RLJ Lodging Trust Company Profile

RLJ Lodging Trust is a self-administered real estate investment trust. The Company is engaged in the acquisition of focused-service and compact full-service hotels. As of December 31, 2016, the Company owned 122 hotels with approximately 20,100 rooms, located in 21 states and the District of Columbia, and an interest in one mortgage loan secured by a hotel. Its hotels’ brand affiliations include Residence Inn, Courtyard, SpringHill Suites, Fairfield Inn & Suites, Marriott, Renaissance, Hilton Garden Inn, Hampton Inn/Hampton Inn & Suites, Embassy Suites, DoubleTree, Homewood Suites, Hilton, Hyatt House, Hyatt Place and Hyatt/Hyatt Centric. Its operating partnership is RLJ Lodging Trust, L.P. Its properties include Courtyard San Francisco, Courtyard Boulder Longmont, Residence Inn Longmont Boulder, DoubleTree Grand Key Resort, Courtyard Atlanta Buckhead, Courtyard Chicago Southeast Hammond, Courtyard Louisville Northeast, DoubleTree Hotel Columbia and Residence Inn Detroit Novi.

Hospitality Properties Trust Company Profile

Hospitality Properties Trust is a real estate investment trust. The Company’s segments include hotel investments, travel center investments and corporate. As of December 31, 2016, the Company owned 306 hotels with 46,583 rooms or suites, and 198 travel centers. As of December 31, 2016, the Company’s properties were located in 45 states in the United States, Canada and Puerto Rico. As of December 31, 2016, the Company’s hotels were operated as Courtyard by Marriott, Royal Sonesta, Sonesta Hotels & Resorts, Candlewood Suites, Residence Inn by Marriott, Sonesta ES Suites, Crowne Plaza Hotels & Resorts, Staybridge Suites, Hyatt Place, Wyndham Grand, Wyndham Hotels & Resorts, InterContinental Hotels & Resorts, Marriott Hotels and Resorts, the Clift Hotel, Radisson Hotels & Resorts, Kimpton Hotels & Restaurants, TownePlace Suites by Marriott, Hawthorn Suites, Country Inns & Suites by Carlson, Holiday Inn Hotels & Resorts, SpringHill Suites by Marriott, and Park Plaza Hotels & Resorts.

Receive News & Ratings for RLJ Lodging Trust Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for RLJ Lodging Trust and related companies with Analyst Ratings Network's FREE daily email newsletter.