Pebblebrook Hotel Trust (NYSE: PEB) 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 analyst recommendations, profitability, risk, valuation, earnings, institutional ownership and dividends.

Profitability

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

Net Margins Return on Equity Return on Assets
Pebblebrook Hotel Trust 12.98% 6.63% 3.78%
Hospitality Properties Trust 11.66% 8.79% 3.58%

Volatility & Risk

Pebblebrook Hotel Trust has a beta of 1.21, suggesting that its stock price is 21% more volatile than the S&P 500. Comparatively, Hospitality Properties Trust has a beta of 1.05, suggesting that its stock price is 5% more volatile than the S&P 500.

Dividends

Pebblebrook Hotel Trust pays an annual dividend of $1.52 per share and has a dividend yield of 4.1%. Hospitality Properties Trust pays an annual dividend of $2.08 per share and has a dividend yield of 7.0%. Pebblebrook Hotel Trust pays out 117.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Hospitality Properties Trust pays out 148.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Pebblebrook Hotel Trust has increased its dividend for 4 consecutive years.

Valuation & Earnings

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

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Pebblebrook Hotel Trust $816.42 million 3.11 $73.70 million $1.29 28.50
Hospitality Properties Trust $2.05 billion 2.38 $223.11 million $1.40 21.14

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

Institutional and Insider Ownership

76.0% of Hospitality Properties Trust shares are owned by institutional investors. 2.0% of Pebblebrook Hotel 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 endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Pebblebrook Hotel Trust and Hospitality Properties Trust, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Pebblebrook Hotel Trust 2 3 5 0 2.30
Hospitality Properties Trust 0 3 4 0 2.57

Pebblebrook Hotel Trust presently has a consensus price target of $35.31, suggesting a potential downside of 3.96%. Hospitality Properties Trust has a consensus price target of $32.20, suggesting a potential upside of 8.78%. Given Hospitality Properties Trust’s stronger consensus rating and higher possible upside, analysts clearly believe Hospitality Properties Trust is more favorable than Pebblebrook Hotel Trust.

Summary

Pebblebrook Hotel Trust beats Hospitality Properties Trust on 9 of the 17 factors compared between the two stocks.

Pebblebrook Hotel Trust Company Profile

Pebblebrook Hotel Trust is an internally managed hotel investment company. The Company is a real estate investment trust (REIT) that acquires and invests in hotel properties located primarily in cities of the United States. As of December 31, 2016, the Company owned 29 hotels with a total of 7,219 guest rooms. The hotels are located in the markets: Atlanta (Buckhead), Georgia; Boston, Massachusetts; Miami (Coral Gables), Florida; Minneapolis, Minnesota; Naples, Florida; Nashville, Tennessee; New York, New York; Philadelphia, Pennsylvania; Portland, Oregon; San Diego, California; San Francisco, California; Santa Monica, California; Seattle, Washington; Stevenson, Washington; Washington, D.C.; West Hollywood, California, and Los Angeles (Beverly Hills), California. The Company’s assets are held by, and all of the operations are conducted through, Pebblebrook Hotel, L.P. (the Operating Partnership).

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.

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