Comparing Summit Hotel Properties (INN) & Lamar Advertising (LAMR)

Summit Hotel Properties (NYSE:INN) and Lamar Advertising (NASDAQ:LAMR) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, institutional ownership, risk, analyst recommendations, profitability, earnings and valuation.

Profitability

This table compares Summit Hotel Properties and Lamar Advertising’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Summit Hotel Properties 16.76% 7.79% 4.26%
Lamar Advertising 18.57% 27.51% 7.16%

Earnings & Valuation

This table compares Summit Hotel Properties and Lamar Advertising’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Summit Hotel Properties $515.38 million 2.26 $99.21 million $1.34 8.30
Lamar Advertising $1.54 billion 4.91 $317.67 million $5.05 15.06

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

Risk & Volatility

Summit Hotel Properties has a beta of 1.36, indicating that its stock price is 36% more volatile than the S&P 500. Comparatively, Lamar Advertising has a beta of 1.11, indicating that its stock price is 11% more volatile than the S&P 500.

Insider & Institutional Ownership

81.3% of Lamar Advertising shares are owned by institutional investors. 2.1% of Summit Hotel Properties shares are owned by company insiders. Comparatively, 15.6% of Lamar Advertising shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Dividends

Summit Hotel Properties pays an annual dividend of $0.72 per share and has a dividend yield of 6.5%. Lamar Advertising pays an annual dividend of $3.64 per share and has a dividend yield of 4.8%. Summit Hotel Properties pays out 53.7% of its earnings in the form of a dividend. Lamar Advertising pays out 72.1% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Summit Hotel Properties has increased its dividend for 4 consecutive years and Lamar Advertising has increased its dividend for 2 consecutive years. Summit Hotel Properties is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a breakdown of current ratings for Summit Hotel Properties and Lamar Advertising, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Summit Hotel Properties 0 1 5 0 2.83
Lamar Advertising 1 3 1 0 2.00

Summit Hotel Properties presently has a consensus price target of $15.40, suggesting a potential upside of 38.49%. Lamar Advertising has a consensus price target of $76.80, suggesting a potential upside of 1.01%. Given Summit Hotel Properties’ stronger consensus rating and higher possible upside, equities analysts plainly believe Summit Hotel Properties is more favorable than Lamar Advertising.

Summary

Lamar Advertising beats Summit Hotel Properties on 10 of the 17 factors compared between the two stocks.

About Summit Hotel Properties

Summit Hotel Properties, Inc. is a publicly-traded real estate investment trust focused on owning premium-branded hotels with efficient operating models primarily in the Upscale segment of the lodging industry. As of October 30, 2018, the Company's portfolio consisted of 77 hotels with a total of 11,659 guestrooms located in 26 states.

About Lamar Advertising

Founded in 1902, Lamar Advertising (Nasdaq: LAMR) is one of the largest outdoor advertising companies in North America, with more than 348,000 displays across the United States and Canada. Lamar offers advertisers a variety of billboard, interstate logo, transit and airport advertising formats, helping both local businesses and national brands reach broad audiences every day. In addition to its more traditional out-of-home inventory, Lamar is proud to offer its customers the largest network of digital billboards in the United States with over 2,900 displays.

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