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HT or SHO: Which Is the Better Value Stock Right Now?
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Investors interested in stocks from the REIT and Equity Trust - Other sector have probably already heard of Hersha Hospitality and Sunstone Hotel Investors (SHO - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Hersha Hospitality has a Zacks Rank of #2 (Buy), while Sunstone Hotel Investors has a Zacks Rank of #3 (Hold) right now. This means that HT's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its current share price levels.
Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
HT currently has a forward P/E ratio of 10.99, while SHO has a forward P/E of 14.19. We also note that HT has a PEG ratio of 2.22. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. SHO currently has a PEG ratio of 2.96.
Another notable valuation metric for HT is its P/B ratio of 0.85. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, SHO has a P/B of 1.51.
These metrics, and several others, help HT earn a Value grade of A, while SHO has been given a Value grade of C.
HT stands above SHO thanks to its solid earnings outlook, and based on these valuation figures, we also feel that HT is the superior value option right now.
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HT or SHO: Which Is the Better Value Stock Right Now?
Investors interested in stocks from the REIT and Equity Trust - Other sector have probably already heard of Hersha Hospitality and Sunstone Hotel Investors (SHO - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Hersha Hospitality has a Zacks Rank of #2 (Buy), while Sunstone Hotel Investors has a Zacks Rank of #3 (Hold) right now. This means that HT's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its current share price levels.
Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
HT currently has a forward P/E ratio of 10.99, while SHO has a forward P/E of 14.19. We also note that HT has a PEG ratio of 2.22. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. SHO currently has a PEG ratio of 2.96.
Another notable valuation metric for HT is its P/B ratio of 0.85. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, SHO has a P/B of 1.51.
These metrics, and several others, help HT earn a Value grade of A, while SHO has been given a Value grade of C.
HT stands above SHO thanks to its solid earnings outlook, and based on these valuation figures, we also feel that HT is the superior value option right now.