Contrasting FelCor Lodging Trust (FCH) & Host Hotels & Resorts (NYSE:HST)

Host Hotels & Resorts (NYSE: HST) and FelCor Lodging Trust (NYSE:FCH) are both finance companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, earnings, analyst recommendations, valuation, profitabiliy, dividends and risk.

Profitability

This table compares Host Hotels & Resorts and FelCor Lodging Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Host Hotels & Resorts 11.09% 8.43% 5.16%
FelCor Lodging Trust -3.25% -25.32% -1.00%

Dividends

Host Hotels & Resorts pays an annual dividend of $0.80 per share and has a dividend yield of 4.3%. FelCor Lodging Trust pays an annual dividend of $0.24 per share and has a dividend yield of 3.2%. Host Hotels & Resorts pays out 100.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. FelCor Lodging Trust pays out -63.2% of its earnings in the form of a dividend. Host Hotels & Resorts has raised its dividend for 6 consecutive years and FelCor Lodging Trust has raised its dividend for 2 consecutive years. Host Hotels & Resorts is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional & Insider Ownership

76.4% of FelCor Lodging Trust shares are held by institutional investors. 1.7% of Host Hotels & Resorts shares are held by insiders. Comparatively, 3.3% of FelCor Lodging Trust shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Risk and Volatility

Host Hotels & Resorts has a beta of 1.33, meaning that its share price is 33% more volatile than the S&P 500. Comparatively, FelCor Lodging Trust has a beta of 1.74, meaning that its share price is 74% more volatile than the S&P 500.

Valuation and Earnings

This table compares Host Hotels & Resorts and FelCor Lodging Trust’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Host Hotels & Resorts $5.47 billion 2.53 $1.45 billion $0.80 23.39
FelCor Lodging Trust $846.47 million 1.21 $215.00 million ($0.38) -19.47

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

Analyst Ratings

This is a summary of current ratings for Host Hotels & Resorts and FelCor Lodging Trust, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Host Hotels & Resorts 1 10 3 0 2.14
FelCor Lodging Trust 0 2 1 0 2.33

Host Hotels & Resorts currently has a consensus price target of $18.13, suggesting a potential downside of 3.13%. FelCor Lodging Trust has a consensus price target of $7.75, suggesting a potential upside of 4.73%. Given FelCor Lodging Trust’s stronger consensus rating and higher possible upside, analysts plainly believe FelCor Lodging Trust is more favorable than Host Hotels & Resorts.

Summary

Host Hotels & Resorts beats FelCor Lodging Trust on 11 of the 17 factors compared between the two stocks.

Host Hotels & Resorts Company Profile

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.

FelCor Lodging Trust Company Profile

FelCor Lodging Trust Incorporated is a real estate investment trust (REIT). The Company, through its subsidiary, FelCor Lodging Limited Partnership, held ownership interests in 39 hotels with 11,500 rooms, as of December 31, 2016. The Company sells, acquires, rebrands and redevelops hotels. As of December 31, 2016, the Company’s hotels were located in 14 states of the United States. The Company holds a portfolio of hotels managed by Hilton Worldwide (Hilton); Wyndham Worldwide (Wyndham); Marriott International Inc. (Marriott); InterContinental Hotels Group (IHG); AccorHotels Group, Highgate Hotels (Highgate), SBE and Aimbridge Hospitality. The Company’s hotels include Embassy Suites Atlanta-Buckhead; DoubleTree Suites by Hilton Austin; Embassy Suites Birmingham; The Fairmont Copley Plaza, Boston; Wyndham Boston Beacon Hill; Embassy Suites Boston-Marlborough, and Sheraton Burlington Hotel & Conference Center.

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