Reviewing DiamondRock Hospitality (NYSE:DRH) and CTO Realty Growth (NYSE:CTO)

DiamondRock Hospitality (NYSE:DRH) and CTO Realty Growth (NYSE:CTO) are both finance companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, dividends, analyst recommendations, institutional ownership, valuation, risk and earnings.

Profitability

This table compares DiamondRock Hospitality and CTO Realty Growth’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
DiamondRock Hospitality	5.69%	4.04%	2.05%
CTO Realty Growth	9.06%	2.47%	1.12%

Risk & Volatility

DiamondRock Hospitality has a beta of 1, indicating that its share price has a similar volatility profile to the S&P 500.Comparatively, CTO Realty Growth has a beta of 0.62, indicating that its share price is 38% less volatile than the S&P 500.

Valuation and Earnings

This table compares DiamondRock Hospitality and CTO Realty Growth”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DiamondRock Hospitality	$1.12 billion	2.22	$48.05 million	$0.47	25.94
CTO Realty Growth	$149.54 million	4.80	$10.09 million	$0.21	101.14

DiamondRock Hospitality has higher revenue and earnings than CTO Realty Growth. DiamondRock Hospitality is trading at a lower price-to-earnings ratio than CTO Realty Growth, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent recommendations for DiamondRock Hospitality and CTO Realty Growth, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DiamondRock Hospitality	0	7	3	0	2.30
CTO Realty Growth	0	2	3	0	2.60

DiamondRock Hospitality currently has a consensus target price of $11.65, suggesting a potential downside of 4.43%. CTO Realty Growth has a consensus target price of $23.00, suggesting a potential upside of 8.29%. Given CTO Realty Growth’s stronger consensus rating and higher possible upside, analysts plainly believe CTO Realty Growth is more favorable than DiamondRock Hospitality.

Institutional and Insider Ownership

67.2% of CTO Realty Growth shares are owned by institutional investors. 0.9% of DiamondRock Hospitality shares are owned by insiders. Comparatively, 4.5% of CTO Realty Growth shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Dividends

DiamondRock Hospitality pays an annual dividend of $0.36 per share and has a dividend yield of 3.0%. CTO Realty Growth pays an annual dividend of $1.52 per share and has a dividend yield of 7.2%. DiamondRock Hospitality pays out 76.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. CTO Realty Growth pays out 723.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. DiamondRock Hospitality has increased its dividend for 1 consecutive years.

About DiamondRock Hospitality

DiamondRock Hospitality Company is a self-advised real estate investment trust (REIT) that is an owner of a leading portfolio of geographically diversified hotels concentrated in leisure destinations and top gateway markets. The Company currently owns 36 premium quality hotels with over 9,700 rooms. The Company has strategically positioned its portfolio to be operated both under leading global brand families as well as independent boutique hotels in the lifestyle segment.

About CTO Realty Growth

CTO Realty Growth, Inc. is a publicly traded real estate investment trust that owns and operates a portfolio of high-quality, retail-based properties located primarily in higher growth markets in the United States. CTO also externally manages and owns a meaningful interest in Alpine Income Property Trust, Inc. (NYSE: PINE), a publicly traded net lease REIT.