Extended Stay America (STAY) versus Red Lion Hotels (RLH) Head to Head Contrast
Extended Stay America (NYSE: STAY) and Red Lion Hotels (NYSE:RLH) are both consumer discretionary companies, but which is the superior investment? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, institutional ownership, dividends, profitability, earnings and risk.
This table compares Extended Stay America and Red Lion Hotels’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Extended Stay America||5.83%||14.53%||4.74%|
|Red Lion Hotels||-1.81%||-2.53%||-1.37%|
Institutional and Insider Ownership
98.5% of Extended Stay America shares are owned by institutional investors. Comparatively, 66.8% of Red Lion Hotels shares are owned by institutional investors. 0.6% of Extended Stay America shares are owned by company insiders. Comparatively, 14.7% of Red Lion Hotels shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
Volatility & Risk
Extended Stay America has a beta of 0.97, suggesting that its share price is 3% less volatile than the S&P 500. Comparatively, Red Lion Hotels has a beta of 0.76, suggesting that its share price is 24% less volatile than the S&P 500.
This is a breakdown of current recommendations and price targets for Extended Stay America and Red Lion Hotels, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Extended Stay America||0||1||7||0||2.88|
|Red Lion Hotels||0||0||1||0||3.00|
Extended Stay America currently has a consensus target price of $20.53, indicating a potential upside of 17.25%. Red Lion Hotels has a consensus target price of $13.75, indicating a potential upside of 51.93%. Given Red Lion Hotels’ stronger consensus rating and higher possible upside, analysts plainly believe Red Lion Hotels is more favorable than Extended Stay America.
Extended Stay America pays an annual dividend of $0.84 per share and has a dividend yield of 4.8%. Red Lion Hotels does not pay a dividend. Extended Stay America pays out 215.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Red Lion Hotels has raised its dividend for 2 consecutive years.
Earnings and Valuation
This table compares Extended Stay America and Red Lion Hotels’ gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Extended Stay America||$1.27 billion||2.65||$69.93 million||$0.39||44.90|
|Red Lion Hotels||$164.07 million||1.30||-$4.67 million||($0.18)||-50.27|
Extended Stay America has higher revenue and earnings than Red Lion Hotels. Red Lion Hotels is trading at a lower price-to-earnings ratio than Extended Stay America, indicating that it is currently the more affordable of the two stocks.
Extended Stay America beats Red Lion Hotels on 11 of the 16 factors compared between the two stocks.
About Extended Stay America
Extended Stay America, Inc. is a owner/operator of company-branded hotels in North America. The Company operates in the extended stay lodging industry. The Company owns and operates approximately 700 hotel properties consisting of approximately 75,900 rooms located in 44 states across the United States of America and in Canada. The Company owns and operates hotels under the core brand, Extended Stay America. In addition, the Company owns and operates three Extended Stay Canada hotels, 49 hotels in the economy extended stay segment under the Crossland Economy Studios and Hometown Inn brands, and also manage two Extended Stay America hotels.
About Red Lion Hotels
Red Lion Hotels Corporation (RLHC) is a hospitality and leisure company. The Company is engaged in the franchising, management and ownership of hotels under the brands, including Hotel RL, Red Lion Hotel, Red Lion Inn & Suites, GuestHouse and Settle Inn & Suites (collectively the RLHC Brands). The RLHC brands represent upscale, midscale and economy hotels. The Company’s segments include company operated hotel segment, franchised hotels segment and other. The company operated hotel segment is engaged in guest room rentals, and food and beverage operations at its operated hotels. The franchised hotels segment is engaged in licensing its brands to franchisees. The franchised hotels segment offers various programs, which include its reservation system, guest loyalty program, national and regional sales, revenue management tools, quality inspections, advertising and brand standards.
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