Critical Comparison: Sotherly Hotels (NASDAQ:SOHO) and Sunrise Realty Trust (NASDAQ:SUNS)

Sotherly Hotels (NASDAQ:SOHO) and Sunrise Realty Trust (NASDAQ:SUNS) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, risk, analyst recommendations, institutional ownership, dividends, valuation and profitability.

Analyst Recommendations

This is a summary of current recommendations for Sotherly Hotels and Sunrise Realty Trust, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sotherly Hotels	0	1	0	0	2.00
Sunrise Realty Trust	0	0	1	0	3.00

Sotherly Hotels presently has a consensus price target of $1.50, indicating a potential upside of 30.43%. Sunrise Realty Trust has a consensus price target of $17.50, indicating a potential upside of 20.86%. Given Sotherly Hotels’ higher probable upside, analysts clearly believe Sotherly Hotels is more favorable than Sunrise Realty Trust.

Dividends

Sotherly Hotels pays an annual dividend of $0.52 per share and has a dividend yield of 45.2%. Sunrise Realty Trust pays an annual dividend of $0.84 per share and has a dividend yield of 5.8%. Sotherly Hotels pays out -247.6% of its earnings in the form of a dividend.

Insider and Institutional Ownership

27.5% of Sotherly Hotels shares are held by institutional investors. 15.9% of Sotherly Hotels shares are held by insiders. Comparatively, 5.7% of Sunrise Realty Trust shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Sotherly Hotels and Sunrise Realty Trust”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sotherly Hotels	$178.57 million	0.13	$3.94 million	($0.21)	-5.48
Sunrise Realty Trust	$250,000.00	401.39	$230,000.00	N/A	N/A

Sotherly Hotels has higher revenue and earnings than Sunrise Realty Trust.

Profitability

This table compares Sotherly Hotels and Sunrise Realty Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sotherly Hotels	1.88%	6.82%	0.84%
Sunrise Realty Trust	N/A	N/A	N/A

Summary

Sotherly Hotels beats Sunrise Realty Trust on 10 of the 13 factors compared between the two stocks.

About Sotherly Hotels

Sotherly Hotels Inc. is a self-managed and self-administered lodging REIT focused on the acquisition, renovation, upbranding and repositioning of upscale to upper-upscale full-service hotels in the Southern United States. Sotherly may also opportunistically acquire hotels throughout the United States. Currently, the Company's portfolio consists of investments in ten hotel properties, comprising 2,786 rooms, as well as interests in two condominium hotels and their associated rental programs. The Company owns hotels that operate under the Hilton Worldwide and Hyatt Hotels Corporation brands, as well as independent hotels. Sotherly Hotels Inc. was organized in 2004 and is headquartered in Williamsburg, Virginia.

About Sunrise Realty Trust

Sunrise Realty Trust, Inc. engages in commercial real estate (CRE) lending business. It focuses on originating CRE debt investments and providing capital to borrowers and sponsors with transitional business plans collateralized by CRE assets. The company intends to create a diversified investment portfolio, targeting investments in senior mortgage loans, mezzanine loans, whole loans, B-notes, CMBS, and debt-like preferred equity securities across CRE asset classes. Sunrise Realty Trust, Inc. was incorporated in 2023 and is based in West Palm Beach, Florida.