Critical Comparison: DiamondRock Hospitality (NYSE:DRH) & Global Self Storage (NASDAQ:SELF)

DiamondRock Hospitality (NYSE:DRH) and Global Self Storage (NASDAQ:SELF) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their risk, analyst recommendations, dividends, institutional ownership, profitability, valuation and earnings.

Earnings and Valuation

This table compares DiamondRock Hospitality and Global Self Storage”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DiamondRock Hospitality	$1.13 billion	1.82	$48.05 million	$0.25	40.16
Global Self Storage	$12.53 million	4.62	$2.12 million	$0.16	31.88

DiamondRock Hospitality has higher revenue and earnings than Global Self Storage. Global Self Storage is trading at a lower price-to-earnings ratio than DiamondRock Hospitality, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares DiamondRock Hospitality and Global Self Storage’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
DiamondRock Hospitality	5.69%	4.04%	2.05%
Global Self Storage	14.13%	3.81%	2.76%

Volatility & Risk

DiamondRock Hospitality has a beta of 1.03, indicating that its share price is 3% more volatile than the S&P 500. Comparatively, Global Self Storage has a beta of 0.01, indicating that its share price is 99% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for DiamondRock Hospitality and Global Self Storage, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DiamondRock Hospitality	0	6	3	0	2.33
Global Self Storage	0	1	0	0	2.00

DiamondRock Hospitality presently has a consensus price target of $9.91, suggesting a potential downside of 1.33%. Given DiamondRock Hospitality’s stronger consensus rating and higher probable upside, analysts clearly believe DiamondRock Hospitality is more favorable than Global Self Storage.

Insider and Institutional Ownership

28.9% of Global Self Storage shares are owned by institutional investors. 1.4% of DiamondRock Hospitality shares are owned by insiders. Comparatively, 8.0% of Global Self Storage shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Dividends

DiamondRock Hospitality pays an annual dividend of $0.32 per share and has a dividend yield of 3.2%. Global Self Storage pays an annual dividend of $0.29 per share and has a dividend yield of 5.7%. DiamondRock Hospitality pays out 128.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Global Self Storage pays out 181.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. DiamondRock Hospitality has raised its dividend for 1 consecutive years.

Summary

DiamondRock Hospitality beats Global Self Storage on 11 of the 17 factors compared between the two stocks.

About DiamondRock Hospitality

DiamondRock Hospitality Company is a self-advised real estate investment trust (REIT) that is an owner of a leading portfolio of geographically diversified hotels concentrated in leisure destinations and top gateway markets. The Company currently owns 36 premium quality hotels with over 9,700 rooms. The Company has strategically positioned its portfolio to be operated both under leading global brand families as well as independent boutique hotels in the lifestyle segment.

About Global Self Storage

Global Self Storage is a self-administered and self-managed REIT that owns, operates, manages, acquires, and redevelops self-storage properties. The company's self-storage properties are designed to offer affordable, easily accessible and secure storage space for residential and commercial customers. Through its wholly owned subsidiaries, the company owns and/or manages 13 self-storage properties in Connecticut, Illinois, Indiana, New York, Ohio, Pennsylvania, South Carolina, and Oklahoma.