Financial Contrast: Four Corners Property Trust (NYSE:FCPT) & DiamondRock Hospitality (NYSE:DRH)

Four Corners Property Trust (NYSE:FCPT) and DiamondRock Hospitality (NYSE:DRH) are both finance companies, but which is the better business? We will compare the two companies based on the strength of their institutional ownership, profitability, risk, earnings, analyst recommendations, dividends and valuation.

Risk & Volatility

Four Corners Property Trust has a beta of 1.11, indicating that its share price is 11% more volatile than the S&P 500. Comparatively, DiamondRock Hospitality has a beta of 1.6, indicating that its share price is 60% more volatile than the S&P 500.

Insider & Institutional Ownership

98.7% of Four Corners Property Trust shares are owned by institutional investors. 1.2% of Four Corners Property Trust shares are owned by company insiders. Comparatively, 1.4% of DiamondRock Hospitality shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Four Corners Property Trust and DiamondRock Hospitality”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Four Corners Property Trust	$250.61 million	10.78	$95.34 million	$1.07	26.09
DiamondRock Hospitality	$1.11 billion	1.70	$86.34 million	$0.28	32.71

Four Corners Property Trust has higher earnings, but lower revenue than DiamondRock Hospitality. Four Corners Property Trust is trading at a lower price-to-earnings ratio than DiamondRock Hospitality, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Four Corners Property Trust and DiamondRock Hospitality, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Four Corners Property Trust	0	2	2	0	2.50
DiamondRock Hospitality	0	2	3	0	2.60

Four Corners Property Trust currently has a consensus target price of $29.67, suggesting a potential upside of 6.26%. DiamondRock Hospitality has a consensus target price of $10.10, suggesting a potential upside of 10.26%. Given DiamondRock Hospitality’s stronger consensus rating and higher possible upside, analysts plainly believe DiamondRock Hospitality is more favorable than Four Corners Property Trust.

Profitability

This table compares Four Corners Property Trust and DiamondRock Hospitality’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Four Corners Property Trust	37.27%	7.68%	3.96%
DiamondRock Hospitality	6.30%	4.26%	2.17%

Dividends

Four Corners Property Trust pays an annual dividend of $1.38 per share and has a dividend yield of 4.9%. DiamondRock Hospitality pays an annual dividend of $0.12 per share and has a dividend yield of 1.3%. Four Corners Property Trust pays out 129.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. DiamondRock Hospitality pays out 42.9% of its earnings in the form of a dividend.

About Four Corners Property Trust

FCPT, headquartered in Mill Valley, CA, is a real estate investment trust primarily engaged in the ownership, acquisition and leasing of restaurant and retail properties. The Company seeks to grow its portfolio by acquiring additional real estate to lease, on a net basis, for use in the restaurant and retail industries.

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.