Apple Hospitality REIT (NYSE: APLE) and Host Hotels and Resorts (NYSE:HST) are both mid-cap finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, analyst recommendations, dividends, risk, valuation, earnings and institutional ownership.

Volatility & Risk

Apple Hospitality REIT has a beta of 0.62, meaning that its stock price is 38% less volatile than the S&P 500. Comparatively, Host Hotels and Resorts has a beta of 1.29, meaning that its stock price is 29% more volatile than the S&P 500.

Profitability

This table compares Apple Hospitality REIT and Host Hotels and Resorts’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Apple Hospitality REIT 18.37% 6.46% 4.58%
Host Hotels and Resorts 11.11% 8.44% 5.11%

Analyst Recommendations

This is a summary of current recommendations and price targets for Apple Hospitality REIT and Host Hotels and Resorts, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Apple Hospitality REIT 0 4 1 0 2.20
Host Hotels and Resorts 1 6 8 0 2.47

Apple Hospitality REIT currently has a consensus price target of $20.00, indicating a potential upside of 1.94%. Host Hotels and Resorts has a consensus price target of $20.50, indicating a potential upside of 0.89%. Given Apple Hospitality REIT’s higher probable upside, research analysts clearly believe Apple Hospitality REIT is more favorable than Host Hotels and Resorts.

Institutional and Insider Ownership

50.9% of Apple Hospitality REIT shares are owned by institutional investors. 6.3% of Apple Hospitality REIT shares are owned by company insiders. Comparatively, 1.7% of Host Hotels and Resorts shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Dividends

Apple Hospitality REIT pays an annual dividend of $1.20 per share and has a dividend yield of 6.1%. Host Hotels and Resorts pays an annual dividend of $0.80 per share and has a dividend yield of 3.9%. Apple Hospitality REIT pays out 118.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Host Hotels and Resorts pays out 98.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Earnings & Valuation

This table compares Apple Hospitality REIT and Host Hotels and Resorts’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Apple Hospitality REIT $1.04 billion 4.20 $144.65 million $1.01 19.43
Host Hotels and Resorts $5.43 billion 2.77 $762.00 million $0.81 25.09

Host Hotels and Resorts has higher revenue and earnings than Apple Hospitality REIT. Apple Hospitality REIT is trading at a lower price-to-earnings ratio than Host Hotels and Resorts, indicating that it is currently the more affordable of the two stocks.

Summary

Host Hotels and Resorts beats Apple Hospitality REIT on 9 of the 16 factors compared between the two stocks.

About Apple Hospitality REIT

Apple Hospitality REIT, Inc. is a hospitality real estate investment trust. The Company invests in real estate, primarily in the lodging sector, in the United States. As of December 5, 2017, the Company owned 239 hotels, with more than 30,300 guestrooms, diversified across the Hilton and Marriott families of brands with locations in urban, high-end suburban and developing markets across 34 states. The Company’s hotels include various brands, such as Hilton Garden Inn, Courtyard, Homewood Suites, Residence Inn, SpringHill Suites, TownePlace Suites, Fairfield Inn, Home2 Suites, Marriott, Embassy Suites, Hilton and Renaissance. The Company’s hotels are located in various states of the United States, such as Alabama, Alaska, Arizona, Arkansas, California, Colorado, Florida, Georgia, Idaho, Indiana, Iowa, Kansas, Maryland, Michigan, Minnesota, Nebraska, New Jersey, North Carolina, Ohio, South Carolina, Texas, Utah and Virginia.

About Host Hotels and Resorts

Host Hotels & Resorts, Inc. (Host Inc.) operates as a self-managed and self-administered real estate investment trust (REIT). The Company operates through hotel ownership segment. The Company operates through hotel ownership segment. The Company owned properties and conducted operations through Host Hotels & Resorts, L.P. (Host L.P.), of which Host Inc. was the general partner and of which it held approximately 99% of the partnership interests (OP units), as of December 31, 2016. As of February 20, 2017, its lodging portfolio consisted of 96 primarily luxury and upper-upscale hotels containing approximately 53,500 rooms, with the majority located in the United States, and with seven of the properties located outside of the United States in Australia, Brazil, Canada and Mexico. In addition, it owns non-controlling interests in two international joint ventures: approximately a 33% interest in a joint venture in Europe, and a 9% indirect interest, through joint ventures in India.

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