Ventas (NYSE:VTR) & RLJ Lodging Trust (NYSE:RLJ) Critical Contrast

Ventas (NYSE:VTR) and RLJ Lodging Trust (NYSE:RLJ) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, valuation, analyst recommendations, risk, institutional ownership, profitability and earnings.

Valuation and Earnings

This table compares Ventas and RLJ Lodging Trust”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ventas	$5.83 billion	7.42	$251.38 million	$0.55	161.92
RLJ Lodging Trust	$1.35 billion	1.33	$28.51 million	($0.01)	-1,183.20

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

Institutional and Insider Ownership

94.2% of Ventas shares are owned by institutional investors. Comparatively, 92.4% of RLJ Lodging Trust shares are owned by institutional investors. 0.5% of Ventas shares are owned by company insiders. Comparatively, 3.7% of RLJ Lodging Trust shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Ventas and RLJ Lodging Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ventas	4.25%	2.09%	0.96%
RLJ Lodging Trust	1.84%	1.37%	0.52%

Risk & Volatility

Ventas has a beta of 0.71, indicating that its stock price is 29% less volatile than the S&P 500. Comparatively, RLJ Lodging Trust has a beta of 1.13, indicating that its stock price is 13% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Ventas and RLJ Lodging Trust, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ventas	0	3	15	0	2.83
RLJ Lodging Trust	2	5	2	0	2.00

Ventas presently has a consensus target price of $96.00, suggesting a potential upside of 7.80%. RLJ Lodging Trust has a consensus target price of $10.56, suggesting a potential downside of 10.73%. Given Ventas’ stronger consensus rating and higher possible upside, analysts plainly believe Ventas is more favorable than RLJ Lodging Trust.

Dividends

Ventas pays an annual dividend of $2.08 per share and has a dividend yield of 2.3%. RLJ Lodging Trust pays an annual dividend of $0.60 per share and has a dividend yield of 5.1%. Ventas pays out 378.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. RLJ Lodging Trust pays out -6,000.0% of its earnings in the form of a dividend. Ventas has raised its dividend for 1 consecutive years and RLJ Lodging Trust has raised its dividend for 3 consecutive years. RLJ Lodging Trust is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Ventas beats RLJ Lodging Trust on 12 of the 17 factors compared between the two stocks.

About Ventas

Ventas Inc. (NYSE: VTR) is a leading S&P 500 real estate investment trust focused on delivering strong, sustainable shareholder returns by enabling exceptional environments that benefit a large and growing aging population. The Company's growth is fueled by its senior housing communities, which provide valuable services to residents and enable them to thrive in supported environments. Ventas leverages its unmatched operational expertise, data-driven insights from its Ventas Operational InsightsTM platform, extensive relationships and strong financial position to achieve its goal of delivering outsized performance across approximately 1,400 properties. The Ventas portfolio is composed of senior housing communities, outpatient medical buildings, research centers and healthcare facilities in North America and the United Kingdom. The Company benefits from a seasoned team of talented professionals who share a commitment to excellence, integrity and a common purpose of helping people live longer, healthier, happier lives.

About RLJ Lodging Trust

RLJ Lodging Trust is a self-advised, publicly traded real estate investment trust that owns primarily premium-branded, high-margin, focused-service and compact full-service hotels. The Company's portfolio currently consists of 96 hotels with approximately 21,200 rooms, located in 23 states and the District of Columbia and an ownership interest in one unconsolidated hotel with 171 rooms.