Sotherly Hotels (NASDAQ: SOHO) and Ashford Hospitality Prime (NYSE:AHP) are both small-cap financials companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, risk, profitability, dividends, valuation and earnings.
Earnings & Valuation
This table compares Sotherly Hotels and Ashford Hospitality Prime’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Sotherly Hotels||$152.85 million||0.62||$920,000.00||($0.01)||-682.00|
|Ashford Hospitality Prime||$405.86 million||0.72||$19.31 million||($0.25)||-36.76|
This table compares Sotherly Hotels and Ashford Hospitality Prime’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Ashford Hospitality Prime||-0.36%||-0.43%||-0.10%|
Insider & Institutional Ownership
27.3% of Sotherly Hotels shares are owned by institutional investors. Comparatively, 65.1% of Ashford Hospitality Prime shares are owned by institutional investors. 13.8% of Sotherly Hotels shares are owned by company insiders. Comparatively, 10.0% of Ashford Hospitality Prime shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Volatility and Risk
Sotherly Hotels has a beta of 0.71, meaning that its share price is 29% less volatile than the S&P 500. Comparatively, Ashford Hospitality Prime has a beta of 1.18, meaning that its share price is 18% more volatile than the S&P 500.
Sotherly Hotels pays an annual dividend of $0.44 per share and has a dividend yield of 6.5%. Ashford Hospitality Prime pays an annual dividend of $0.64 per share and has a dividend yield of 7.0%. Sotherly Hotels pays out -4,400.0% of its earnings in the form of a dividend. Ashford Hospitality Prime pays out -256.0% 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. Ashford Hospitality Prime has raised its dividend for 2 consecutive years. Ashford Hospitality Prime is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This is a summary of recent ratings for Sotherly Hotels and Ashford Hospitality Prime, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Ashford Hospitality Prime||0||3||4||0||2.57|
Sotherly Hotels presently has a consensus target price of $8.00, suggesting a potential upside of 17.30%. Ashford Hospitality Prime has a consensus target price of $13.40, suggesting a potential upside of 45.81%. Given Ashford Hospitality Prime’s stronger consensus rating and higher possible upside, analysts plainly believe Ashford Hospitality Prime is more favorable than Sotherly Hotels.
Ashford Hospitality Prime beats Sotherly Hotels on 10 of the 17 factors compared between the two stocks.
About Sotherly Hotels
Sotherly Hotels Inc. is a self-managed and self-administered lodging real estate investment trust. The Company is focused on the acquisition, renovation, upbranding and repositioning of upscale to upper-upscale full-service hotels in the southern United States. The Company operates through the hotel ownership segment. The Company conducts its operations through Sotherly Hotels LP, its Operating Partnership, of which the Company is the general partner. Its portfolio consists of approximately 10 full-service, mainly upscale and upper-upscale hotels located in over eight states with an aggregate of approximately 3,010 rooms and approximately 160,930 square feet of meeting space. All of these hotels are owned by subsidiaries of the Operating Partnership, approximately 10 operate under the Hilton, Crowne Plaza, DoubleTree and Sheraton brands, one is an independent hotel, and all are managed on a day to day basis by MHI Hotels Services, LLC, which does business as Chesapeake Hospitality.
About Ashford Hospitality Prime
Ashford Hospitality Prime, Inc. invests in high revenue per available room (RevPAR), luxury hotels and resorts. The Company conducts its business and owns all of its assets through its operating partnership, Ashford Hospitality Prime Limited Partnership (Ashford Prime OP). The Company operates in the direct hotel investment segment of the hotel lodging industry. As of February 24, 2017, it owned interests in 11 hotel properties in six states, the District of Columbia and St. Thomas, the United States Virgin Islands with 3,702 total rooms, or 3,467 net rooms, excluding those attributable to its joint venture partner. The hotel properties in its portfolio are mainly located in the Unites States urban markets. The Company owns nine of its hotel properties directly, and the remaining two hotel properties through an investment in a majority-owned consolidated entity. All of the hotels in the Company’s portfolio are asset-managed by Ashford Hospitality Advisors LLC.
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