Sunstone Hotel Investors (SHO) vs. Wyndham Worldwide (WYN) Financial Review
Sunstone Hotel Investors (NYSE: SHO) and Wyndham Worldwide (NYSE:WYN) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their profitability, analyst recommendations, dividends, valuation, risk, institutional ownership and earnings.
Sunstone Hotel Investors pays an annual dividend of $0.20 per share and has a dividend yield of 1.2%. Wyndham Worldwide pays an annual dividend of $2.64 per share and has a dividend yield of 2.4%. Sunstone Hotel Investors pays out 16.4% of its earnings in the form of a dividend. Wyndham Worldwide pays out 48.0% 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. Wyndham Worldwide has raised its dividend for 8 consecutive years. Wyndham Worldwide is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Sunstone Hotel Investors has a beta of 1.06, indicating that its share price is 6% more volatile than the S&P 500. Comparatively, Wyndham Worldwide has a beta of 1.36, indicating that its share price is 36% more volatile than the S&P 500.
This is a summary of current recommendations and price targets for Sunstone Hotel Investors and Wyndham Worldwide, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Sunstone Hotel Investors||1||7||2||0||2.10|
Sunstone Hotel Investors currently has a consensus price target of $16.64, indicating a potential upside of 2.99%. Wyndham Worldwide has a consensus price target of $143.00, indicating a potential upside of 31.87%. Given Wyndham Worldwide’s stronger consensus rating and higher probable upside, analysts plainly believe Wyndham Worldwide is more favorable than Sunstone Hotel Investors.
Institutional & Insider Ownership
90.1% of Wyndham Worldwide shares are held by institutional investors. 0.9% of Sunstone Hotel Investors shares are held by insiders. Comparatively, 2.2% of Wyndham Worldwide shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
This table compares Sunstone Hotel Investors and Wyndham Worldwide’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Sunstone Hotel Investors||10.08%||4.26%||2.73%|
Valuation & Earnings
This table compares Sunstone Hotel Investors and Wyndham Worldwide’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Sunstone Hotel Investors||$1.19 billion||3.09||$145.37 million||$1.22||13.25|
|Wyndham Worldwide||$5.08 billion||2.13||$871.00 million||$5.50||19.72|
Wyndham Worldwide has higher revenue and earnings than Sunstone Hotel Investors. Sunstone Hotel Investors is trading at a lower price-to-earnings ratio than Wyndham Worldwide, indicating that it is currently the more affordable of the two stocks.
Wyndham Worldwide beats Sunstone Hotel Investors on 15 of the 17 factors compared between the two stocks.
Sunstone Hotel Investors Company Profile
Sunstone Hotel Investors, Inc. is a lodging real estate investment trust ("REIT") that as of May 7, 2018 has interests in 25 hotels comprised of 12,450 rooms. Sunstone's hotels are primarily in the urban and resort upper upscale segment and are predominantly operated under nationally recognized brands, such as Marriott, Hilton and Hyatt. For further information, please visit Sunstone's website at www.sunstonehotels.com.
Wyndham Worldwide Company Profile
Wyndham Worldwide Corporation provides hospitality services and products to individual and business customers worldwide. It operates through three segments: Hotel Group, Destination Network, and Vacation Ownership. The Hotel Group segment primarily franchises hotels in the upscale, upper midscale, midscale, economy, and extended stay segments, as well as provides property management services for full-service and select limited-service hotels. This segment operates approximately 8,422 franchised hotels and 728,000 hotel rooms. The Destination Network segment provides vacation exchange services and products to owners of vacation ownership interests (VOIs); and manages and markets vacation rental properties primarily on behalf of independent owners. This segment operates vacation exchange network with approximately 3.9 million members. The Vacation Ownership segment develops, markets, and sells VOIs to individual consumers; and provides consumer financing in connection with the sale of VOIs, as well as offers property management services at resorts. The company offers its hospitality services and products under the Wyndham Hotels and Resorts, Ramada, Days Inn, Super 8, Howard Johnson, Wingate by Wyndham, Microtel Inns & Suites by Wyndham, TRYP by Wyndham, Dolce Hotels and Resorts, RCI, Wyndham Vacation Rentals, Wyndham Vacation Resorts, Shell Vacations Club, and WorldMark by Wyndham. Wyndham Worldwide Corporation was founded in 1990 and is headquartered in Parsippany, New Jersey.
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