Reviewing RLJ Lodging Trust (RLJ) and Ashford Hospitality Trust (AHT)
Ashford Hospitality Trust (NYSE: AHT) and RLJ Lodging Trust (NYSE:RLJ) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, dividends, profitability, earnings, analyst recommendations, valuation and institutional ownership.
This is a breakdown of current ratings and recommmendations for Ashford Hospitality Trust and RLJ Lodging Trust, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Ashford Hospitality Trust||0||3||3||0||2.50|
|RLJ Lodging Trust||2||3||6||0||2.36|
Ashford Hospitality Trust presently has a consensus price target of $7.46, suggesting a potential upside of 10.66%. RLJ Lodging Trust has a consensus price target of $24.09, suggesting a potential upside of 9.06%. Given Ashford Hospitality Trust’s stronger consensus rating and higher possible upside, equities analysts plainly believe Ashford Hospitality Trust is more favorable than RLJ Lodging Trust.
Earnings and Valuation
This table compares Ashford Hospitality Trust and RLJ Lodging Trust’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Ashford Hospitality Trust||$1.45 billion||0.45||$394.52 million||($1.34)||-5.03|
|RLJ Lodging Trust||$1.12 billion||2.44||$355.90 million||$1.45||15.23|
Ashford Hospitality Trust has higher revenue and earnings than RLJ Lodging Trust. Ashford Hospitality Trust is trading at a lower price-to-earnings ratio than RLJ Lodging Trust, indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
Ashford Hospitality Trust has a beta of 1.48, meaning that its share price is 48% more volatile than the S&P 500. Comparatively, RLJ Lodging Trust has a beta of 1.17, meaning that its share price is 17% more volatile than the S&P 500.
Insider & Institutional Ownership
70.3% of Ashford Hospitality Trust shares are owned by institutional investors. 18.2% of Ashford Hospitality Trust shares are owned by insiders. Comparatively, 2.3% of RLJ Lodging Trust shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
This table compares Ashford Hospitality Trust and RLJ Lodging Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Ashford Hospitality Trust||-5.43%||-10.41%||-1.64%|
|RLJ Lodging Trust||16.12%||8.16%||4.52%|
Ashford Hospitality Trust pays an annual dividend of $0.48 per share and has a dividend yield of 7.1%. RLJ Lodging Trust pays an annual dividend of $0.44 per share and has a dividend yield of 2.0%. Ashford Hospitality Trust pays out -35.8% of its earnings in the form of a dividend. RLJ Lodging Trust pays out 30.3% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Ashford Hospitality Trust has raised its dividend for 6 consecutive years. Ashford Hospitality Trust is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Ashford Hospitality Trust beats RLJ Lodging Trust on 10 of the 16 factors compared between the two stocks.
About Ashford Hospitality Trust
Ashford Hospitality Trust, Inc. is an externally-advised real estate investment trust (REIT). The Company is focused on investing in the hospitality industry with a focus on full-service upscale and upper-upscale hotels in the United States. The Company owns its lodging investments and conducts its business through Ashford Hospitality Limited Partnership (Ashford Trust OP), its operating partnership. The Company’s portfolio consists of 121 properties with over 25000 rooms; 86 hotel condominium units at WorldQuest Resort in Orlando, Florida; a 96.6% ownership in Ashford Quantitative Alternatives (U.S.), LP (the AQUA U.S. Fund); a 29.7% ownership in Ashford Inc., and a 13.3% ownership in OpenKey.
About RLJ Lodging Trust
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.
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