Park Hotels & Resorts (NYSE:PK) versus Alexander’s (NYSE:ALX) Critical Survey

Park Hotels & Resorts (NYSE:PK) and Alexander’s (NYSE:ALX) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, valuation, profitability, institutional ownership, analyst recommendations, dividends and risk.

Dividends

Park Hotels & Resorts pays an annual dividend of $1.00 per share and has a dividend yield of 6.9%. Alexander’s pays an annual dividend of $18.00 per share and has a dividend yield of 6.4%. Park Hotels & Resorts pays out -91.7% of its earnings in the form of a dividend. Alexander’s pays out 450.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Park Hotels & Resorts has raised its dividend for 1 consecutive years and Alexander’s has raised its dividend for 1 consecutive years. Park Hotels & Resorts is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk & Volatility

Park Hotels & Resorts has a beta of 1.37, meaning that its share price is 37% more volatile than the S&P 500. Comparatively, Alexander’s has a beta of 0.78, meaning that its share price is 22% less volatile than the S&P 500.

Profitability

This table compares Park Hotels & Resorts and Alexander’s’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Park Hotels & Resorts	-8.49%	-6.71%	-2.60%
Alexander’s	9.72%	17.38%	1.71%

Earnings & Valuation

This table compares Park Hotels & Resorts and Alexander’s”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Park Hotels & Resorts	$2.54 billion	1.15	-$283.00 million	($1.09)	-13.35
Alexander’s	$213.18 million	6.74	$28.22 million	$4.00	70.28

Alexander’s has lower revenue, but higher earnings than Park Hotels & Resorts. Park Hotels & Resorts is trading at a lower price-to-earnings ratio than Alexander’s, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

92.7% of Park Hotels & Resorts shares are owned by institutional investors. Comparatively, 32.0% of Alexander’s shares are owned by institutional investors. 2.5% of Park Hotels & Resorts shares are owned by company insiders. Comparatively, 26.4% of Alexander’s shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of current ratings for Park Hotels & Resorts and Alexander’s, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Park Hotels & Resorts	2	10	1	0	1.92
Alexander’s	0	2	0	0	2.00

Park Hotels & Resorts currently has a consensus target price of $12.95, indicating a potential downside of 11.00%. Given Park Hotels & Resorts’ higher possible upside, equities research analysts plainly believe Park Hotels & Resorts is more favorable than Alexander’s.

Summary

Alexander’s beats Park Hotels & Resorts on 9 of the 16 factors compared between the two stocks.

About Park Hotels & Resorts

Park Hotels & Resorts, Inc. operates as a real estate investment trust, which owns and operates hotels and resorts. It operates through the Consolidated Hotels and Unconsolidated Hotels segments. Its portfolio of hotels and resorts include the Waldorf Astoria Hotels and Resorts, Conrad Hotels & Resorts, Hilton Hotels & Resorts, DoubleTree by Hilton, Embassy Suites by Hilton, Hilton Garden Inn, Hampton by Hilton, and Curio. The company was founded by Conrad Hilton in 1919 and is headquartered in Tysons, VA.

About Alexander’s

Alexander’s, Inc. (NYSE: ALX) is a real estate investment trust (REIT), incorporated in Delaware, engaged in leasing, managing, developing and redeveloping its properties. All references to we, us, our, Company and Alexander’s refer to Alexander’s, Inc. and its consolidated subsidiaries. We are managed by, and our properties are leased and developed by, Vornado Realty Trust (Vornado) (NYSE: VNO). We have five properties in New York City.