Apple Hospitality REIT (APLE) versus Chesapeake Lodging Trust (CHSP) Critical Analysis
Apple Hospitality REIT (NYSE: APLE) and Chesapeake Lodging Trust (NYSE:CHSP) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, risk, analyst recommendations, profitability, dividends, earnings and valuation.
Valuation & Earnings
This table compares Apple Hospitality REIT and Chesapeake Lodging Trust’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Apple Hospitality REIT||$1.18 billion||3.57||$420.26 million||$0.80||23.61|
|Chesapeake Lodging Trust||$606.99 million||2.71||$175.85 million||$0.97||28.70|
Apple Hospitality REIT has higher revenue and earnings than Chesapeake Lodging Trust. Apple Hospitality REIT is trading at a lower price-to-earnings ratio than Chesapeake Lodging Trust, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Apple Hospitality REIT has a beta of 0.61, indicating that its stock price is 39% less volatile than the S&P 500. Comparatively, Chesapeake Lodging Trust has a beta of 1.11, indicating that its stock price is 11% more volatile than the S&P 500.
This table compares Apple Hospitality REIT and Chesapeake Lodging Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Apple Hospitality REIT||14.97%||5.05%||3.57%|
|Chesapeake Lodging Trust||10.77%||5.53%||3.19%|
This is a breakdown of current recommendations and price targets for Apple Hospitality REIT and Chesapeake Lodging Trust, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Apple Hospitality REIT||0||3||1||0||2.25|
|Chesapeake Lodging Trust||0||4||2||0||2.33|
Apple Hospitality REIT presently has a consensus price target of $20.00, indicating a potential upside of 5.88%. Chesapeake Lodging Trust has a consensus price target of $25.80, indicating a potential downside of 7.33%. Given Apple Hospitality REIT’s higher possible upside, equities analysts clearly believe Apple Hospitality REIT is more favorable than Chesapeake Lodging Trust.
Insider & Institutional Ownership
49.0% of Apple Hospitality REIT shares are owned by institutional investors. Comparatively, 98.4% of Chesapeake Lodging Trust shares are owned by institutional investors. 6.3% of Apple Hospitality REIT shares are owned by company insiders. Comparatively, 2.2% of Chesapeake Lodging Trust shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
Apple Hospitality REIT pays an annual dividend of $1.20 per share and has a dividend yield of 6.4%. Chesapeake Lodging Trust pays an annual dividend of $1.60 per share and has a dividend yield of 5.7%. Apple Hospitality REIT pays out 150.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Chesapeake Lodging Trust pays out 164.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Apple Hospitality REIT has raised its dividend for 5 consecutive years. Apple Hospitality REIT is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Apple Hospitality REIT beats Chesapeake Lodging Trust on 10 of the 17 factors compared between the two stocks.
Apple Hospitality REIT Company Profile
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 September 13, 2017, the Company owned 237 hotels, with more than 30,000 guestrooms, diversified across the Hilton and Marriott families of brands with locations in urban, high-end suburban and developing markets across 33 states. As of December 31, 2016, the Company’s hotels included 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. As of December 31, 2016, the Company’s hotels were 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.
Chesapeake Lodging Trust Company Profile
Chesapeake Lodging Trust is a real estate investment trust. The Company is focused on investments primarily in upper-upscale hotels in various business and convention markets and, on a selective basis, select-service hotels in urban settings or other locations in the United States. The Company operates through the hotel ownership segment. The Company conducts its operations primarily though Chesapeake Lodging, L.P., its operating partnership (the Operating Partnership). As of February 17, 2017, the Company owned 22 hotels. As of February 17, 2017, the Company’s portfolio included Hyatt Regency Boston; Hilton Checkers Los Angeles; Boston Marriott Newton; Le Meridien San Francisco; Hotel Indigo San Diego Gaslamp Quarter; Courtyard Washington Capitol Hill/Navy Yard; Hotel Adagio San Francisco, Autograph Collection; Denver Marriott City Center; Hyatt Herald Square New York, and Ace Hotel and Theater Downtown Los Angeles. As of February 17, 2017, the Company’s hotels had 6,694 rooms.
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