Contrasting DiamondRock Hospitality (NYSE:DRH) & American Hotel Income Properties REIT (OTCMKTS:AHOTF)

American Hotel Income Properties REIT (OTCMKTS:AHOTF) and DiamondRock Hospitality (NYSE:DRH) are both real estate companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, valuation, earnings, profitability, analyst recommendations, dividends and risk.

Earnings & Valuation

This table compares American Hotel Income Properties REIT and DiamondRock Hospitality”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
American Hotel Income Properties REIT	N/A	N/A	N/A	$0.06	6.25
DiamondRock Hospitality	$1.14 billion	2.20	$48.05 million	$0.73	16.77

DiamondRock Hospitality has higher revenue and earnings than American Hotel Income Properties REIT. American Hotel Income Properties REIT is trading at a lower price-to-earnings ratio than DiamondRock Hospitality, indicating that it is currently the more affordable of the two stocks.

Dividends

American Hotel Income Properties REIT pays an annual dividend of $0.76 per share and has a dividend yield of 199.1%. DiamondRock Hospitality pays an annual dividend of $0.44 per share and has a dividend yield of 3.6%. American Hotel Income Properties REIT pays out 1,245.1% 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 pays out 60.3% of its earnings in the form of a dividend. DiamondRock Hospitality has raised its dividend for 1 consecutive years.

Profitability

This table compares American Hotel Income Properties REIT and DiamondRock Hospitality’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
American Hotel Income Properties REIT	N/A	N/A	N/A
DiamondRock Hospitality	5.69%	4.04%	2.05%

Analyst Ratings

This is a breakdown of recent recommendations and price targets for American Hotel Income Properties REIT and DiamondRock Hospitality, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
American Hotel Income Properties REIT	0	0	0	0	0.00
DiamondRock Hospitality	0	7	4	0	2.36

DiamondRock Hospitality has a consensus target price of $12.22, suggesting a potential downside of 0.16%. Given DiamondRock Hospitality’s stronger consensus rating and higher probable upside, analysts clearly believe DiamondRock Hospitality is more favorable than American Hotel Income Properties REIT.

Insider and Institutional Ownership

10.3% of American Hotel Income Properties REIT shares are owned by institutional investors. 0.9% of DiamondRock Hospitality shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Summary

DiamondRock Hospitality beats American Hotel Income Properties REIT on 12 of the 14 factors compared between the two stocks.

About American Hotel Income Properties REIT

American Hotel Income Properties REIT LP (TSX: HOT.UN, TSX: HOT.U, TSX: HOT.DB.V), or AHIP, is a limited partnership formed to invest in hotel real estate properties across the United States. AHIP’s portfolio of premium branded, select-service hotels are located in secondary metropolitan markets that benefit from diverse and stable demand. AHIP hotels operate under brands affiliated with Marriott, Hilton, IHG and Choice Hotels through license agreements. AHIP’s long-term objectives are to build on its proven track record of successful investment, deliver monthly U.S. dollar denominated distributions to unitholders, and generate value through the continued growth of its diversified hotel portfolio.

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.