Sotherly Hotels (SOHO) vs. LaSalle Hotel Properties (LHO) Head to Head Analysis

Sotherly Hotels (NASDAQ: SOHO) and LaSalle Hotel Properties (NYSE:LHO) are both financials companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, dividends, risk, valuation, analyst recommendations, profitability and earnings.

Institutional & Insider Ownership

29.5% of Sotherly Hotels shares are owned by institutional investors. 13.8% of Sotherly Hotels shares are owned by company insiders. Comparatively, 0.4% of LaSalle Hotel Properties shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Volatility and Risk

Sotherly Hotels has a beta of 0.74, meaning that its share price is 26% less volatile than the S&P 500. Comparatively, LaSalle Hotel Properties has a beta of 1.11, meaning that its share price is 11% more volatile than the S&P 500.

Earnings & Valuation

This table compares Sotherly Hotels and LaSalle Hotel Properties’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Sotherly Hotels $152.85 million 0.56 $920,000.00 ($0.01) -616.00
LaSalle Hotel Properties $1.23 billion 2.79 $252.78 million $1.62 18.67

LaSalle Hotel Properties has higher revenue and earnings than Sotherly Hotels. Sotherly Hotels is trading at a lower price-to-earnings ratio than LaSalle Hotel Properties, indicating that it is currently the more affordable of the two stocks.

Dividends

Sotherly Hotels pays an annual dividend of $0.44 per share and has a dividend yield of 7.1%. LaSalle Hotel Properties pays an annual dividend of $1.80 per share and has a dividend yield of 6.0%. Sotherly Hotels pays out -4,400.0% of its earnings in the form of a dividend. LaSalle Hotel Properties pays out 111.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Sotherly Hotels is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a summary of recent recommendations for Sotherly Hotels and LaSalle Hotel Properties, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Sotherly Hotels 0 0 1 0 3.00
LaSalle Hotel Properties 7 7 0 0 1.50

Sotherly Hotels currently has a consensus price target of $8.00, indicating a potential upside of 29.87%. LaSalle Hotel Properties has a consensus price target of $27.45, indicating a potential downside of 9.24%. Given Sotherly Hotels’ stronger consensus rating and higher possible upside, equities analysts clearly believe Sotherly Hotels is more favorable than LaSalle Hotel Properties.

Profitability

This table compares Sotherly Hotels and LaSalle Hotel Properties’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Sotherly Hotels 2.01% 3.98% 0.75%
LaSalle Hotel Properties 12.34% 4.95% 3.64%

Summary

LaSalle Hotel Properties beats Sotherly Hotels on 9 of the 16 factors compared between the two stocks.

About Sotherly Hotels

Sotherly Hotels Inc. is a self-managed and self-administered lodging real estate investment trust. The Company is focused on the acquisition, renovation, upbranding and repositioning of upscale to upper-upscale full-service hotels in the southern United States. The Company operates through the hotel ownership segment. The Company conducts its operations through Sotherly Hotels LP, its Operating Partnership, of which the Company is the general partner. Its portfolio consists of approximately 10 full-service, mainly upscale and upper-upscale hotels located in over eight states with an aggregate of approximately 3,010 rooms and approximately 160,930 square feet of meeting space. All of these hotels are owned by subsidiaries of the Operating Partnership, approximately 10 operate under the Hilton, Crowne Plaza, DoubleTree and Sheraton brands, one is an independent hotel, and all are managed on a day to day basis by MHI Hotels Services, LLC, which does business as Chesapeake Hospitality.

About LaSalle Hotel Properties

LaSalle Hotel Properties is a self-administered and self-managed real estate investment trust. The Company primarily buys, owns, redevelops and leases upscale and luxury full-service hotels located in convention, resort and urban business markets. As of December 31, 2016, the Company owned interests in 46 hotels with approximately 11,450 guest rooms located in nine states of the United States and the District of Columbia (DC). As of December 31, 2016, the Company’s properties included Hotel Amarano Burbank; Hilton San Diego Gaslamp Quarter; Hotel Solamar; San Diego Paradise Point Resort and Spa; The Hilton San Diego Resort and Spa; Harbor Court Hotel; The Marker San Francisco; Chamberlain West Hollywood; Le Montrose Suite Hotel; The Grafton on Sunset; Hotel George; Hotel Rouge; Mason & Rook Hotel; The Donovan; The Liaison Capitol Hill; The Marker Waterfront Resort; Hotel Chicago; Onyx Hotel; Park Central Hotel New York; The Heathman Hotel; Westin Philadelphia, and Lansdowne Resort.

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