Host Hotels & Resorts (NASDAQ:HST) & Stag Industrial (NYSE:STAG) Critical Analysis

Host Hotels & Resorts (NASDAQ:HST) and Stag Industrial (NYSE:STAG) are both finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, profitability, valuation, risk, dividends and earnings.

Earnings & Valuation

This table compares Host Hotels & Resorts and Stag Industrial”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Host Hotels & Resorts	$5.68 billion	2.11	$697.00 million	$0.94	18.52
Stag Industrial	$767.38 million	8.46	$189.22 million	$1.27	27.38

Host Hotels & Resorts has higher revenue and earnings than Stag Industrial. Host Hotels & Resorts is trading at a lower price-to-earnings ratio than Stag Industrial, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

98.5% of Host Hotels & Resorts shares are owned by institutional investors. Comparatively, 88.7% of Stag Industrial shares are owned by institutional investors. 1.4% of Host Hotels & Resorts shares are owned by insiders. Comparatively, 1.1% of Stag Industrial shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Host Hotels & Resorts and Stag Industrial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Host Hotels & Resorts	11.12%	9.90%	5.07%
Stag Industrial	29.14%	6.71%	3.46%

Volatility and Risk

Host Hotels & Resorts has a beta of 1.36, meaning that its stock price is 36% more volatile than the S&P 500. Comparatively, Stag Industrial has a beta of 0.94, meaning that its stock price is 6% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations for Host Hotels & Resorts and Stag Industrial, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Host Hotels & Resorts	0	5	6	0	2.55
Stag Industrial	0	4	2	0	2.33

Host Hotels & Resorts currently has a consensus target price of $17.77, suggesting a potential upside of 2.10%. Stag Industrial has a consensus target price of $38.33, suggesting a potential upside of 10.26%. Given Stag Industrial’s higher possible upside, analysts plainly believe Stag Industrial is more favorable than Host Hotels & Resorts.

Dividends

Host Hotels & Resorts pays an annual dividend of $0.80 per share and has a dividend yield of 4.6%. Stag Industrial pays an annual dividend of $1.49 per share and has a dividend yield of 4.3%. Host Hotels & Resorts pays out 85.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Stag Industrial pays out 117.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Host Hotels & Resorts has increased its dividend for 2 consecutive years and Stag Industrial has increased its dividend for 7 consecutive years. Host Hotels & Resorts is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Host Hotels & Resorts beats Stag Industrial on 11 of the 17 factors compared between the two stocks.

About Host Hotels & Resorts

Host Hotels & Resorts, Inc. is a real estate investment trust, which engages in the management of luxury and upper-upscale hotels. It operates through the following geographical segments: United States, Brazil, and Canada. The company was founded in 1927 and is headquartered in Bethesda, MD.

About Stag Industrial

STAG Industrial, Inc. is a real estate investment company, which engages in acquiring, owning, and managing single-tenant, industrial real estate assets. It offers industrial real estate operating platform to real estate ownership. The company was founded by Benjamin S. Butcher on July 21, 2010 and is headquartered in Boston, MA.