Contrasting CubeSmart (NYSE:CUBE) & Braemar Hotels & Resorts (NYSE:BHR)

Braemar Hotels & Resorts (NYSE:BHR) and CubeSmart (NYSE:CUBE) are both finance companies, but which is the superior business? We will compare the two companies based on the strength of their profitability, dividends, risk, analyst recommendations, institutional ownership, valuation and earnings.

Dividends

Braemar Hotels & Resorts pays an annual dividend of $0.20 per share and has a dividend yield of 5.7%. CubeSmart pays an annual dividend of $2.04 per share and has a dividend yield of 4.3%. Braemar Hotels & Resorts pays out -17.9% of its earnings in the form of a dividend. CubeSmart pays out 113.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. CubeSmart has raised its dividend for 14 consecutive years. Braemar Hotels & Resorts is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares Braemar Hotels & Resorts and CubeSmart’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Braemar Hotels & Resorts	-3.65%	-8.43%	-1.20%
CubeSmart	38.64%	14.48%	6.54%

Analyst Ratings

This is a breakdown of current recommendations and price targets for Braemar Hotels & Resorts and CubeSmart, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Braemar Hotels & Resorts	0	1	0	0	2.00
CubeSmart	1	7	3	0	2.18

Braemar Hotels & Resorts currently has a consensus price target of $2.50, suggesting a potential downside of 29.18%. CubeSmart has a consensus price target of $46.00, suggesting a potential downside of 3.99%. Given CubeSmart’s stronger consensus rating and higher probable upside, analysts clearly believe CubeSmart is more favorable than Braemar Hotels & Resorts.

Institutional and Insider Ownership

64.8% of Braemar Hotels & Resorts shares are held by institutional investors. Comparatively, 97.6% of CubeSmart shares are held by institutional investors. 1.7% of Braemar Hotels & Resorts shares are held by company insiders. Comparatively, 1.7% of CubeSmart shares are held 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.

Earnings & Valuation

This table compares Braemar Hotels & Resorts and CubeSmart’s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Braemar Hotels & Resorts	$739.34 million	0.32	-$27.02 million	($1.12)	-3.15
CubeSmart	$1.05 billion	10.26	$410.76 million	$1.80	26.62

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

Risk and Volatility

Braemar Hotels & Resorts has a beta of 2, suggesting that its stock price is 100% more volatile than the S&P 500. Comparatively, CubeSmart has a beta of 0.8, suggesting that its stock price is 20% less volatile than the S&P 500.

Summary

CubeSmart beats Braemar Hotels & Resorts on 13 of the 17 factors compared between the two stocks.

About Braemar Hotels & Resorts

Braemar Hotels & Resorts is a conservatively capitalized REIT that invests primarily in high RevPAR, full-service luxury hotels and resorts. We are listed on the New York Stock Exchange under the symbol BHR and are externally-advised by Ashford (NYSE American: AINC).

About CubeSmart

CubeSmart is a self-administered and self-managed real estate investment trust. The Company's self-storage properties are designed to offer affordable, easily accessible and, in most locations, climate-controlled storage space for residential and commercial customers. According to the 2023 Self-Storage Almanac, CubeSmart is one of the top three owners and operators of self-storage properties in the United States.