Federal Realty Investment Trust (NYSE:FRT) vs. Summit Hotel Properties (NYSE:INN) Critical Contrast

Summit Hotel Properties (NYSE:INN) and Federal Realty Investment Trust (NYSE:FRT) are both finance companies, but which is the better business? We will compare the two companies based on the strength of their risk, institutional ownership, profitability, earnings, valuation, dividends and analyst recommendations.

Volatility & Risk

Summit Hotel Properties has a beta of 2.02, suggesting that its stock price is 102% more volatile than the S&P 500. Comparatively, Federal Realty Investment Trust has a beta of 1.24, suggesting that its stock price is 24% more volatile than the S&P 500.

Profitability

This table compares Summit Hotel Properties and Federal Realty Investment Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Summit Hotel Properties	3.41%	1.87%	0.86%
Federal Realty Investment Trust	24.38%	9.89%	3.48%

Dividends

Summit Hotel Properties pays an annual dividend of $0.32 per share and has a dividend yield of 5.1%. Federal Realty Investment Trust pays an annual dividend of $4.40 per share and has a dividend yield of 4.2%. Summit Hotel Properties pays out 3,200.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Federal Realty Investment Trust pays out 128.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Federal Realty Investment Trust has raised its dividend for 58 consecutive years.

Analyst Recommendations

This is a summary of current recommendations for Summit Hotel Properties and Federal Realty Investment Trust, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Summit Hotel Properties	0	0	0	0	0.00
Federal Realty Investment Trust	0	2	11	0	2.85

Federal Realty Investment Trust has a consensus price target of $122.54, indicating a potential upside of 16.11%. Given Federal Realty Investment Trust’s stronger consensus rating and higher possible upside, analysts plainly believe Federal Realty Investment Trust is more favorable than Summit Hotel Properties.

Earnings and Valuation

This table compares Summit Hotel Properties and Federal Realty Investment Trust”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Summit Hotel Properties	$736.29 million	0.92	-$12.11 million	$0.01	627.50
Federal Realty Investment Trust	$1.20 billion	7.52	$295.21 million	$3.43	30.77

Federal Realty Investment Trust has higher revenue and earnings than Summit Hotel Properties. Federal Realty Investment Trust is trading at a lower price-to-earnings ratio than Summit Hotel Properties, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

96.5% of Summit Hotel Properties shares are owned by institutional investors. Comparatively, 93.9% of Federal Realty Investment Trust shares are owned by institutional investors. 3.4% of Summit Hotel Properties shares are owned by insiders. Comparatively, 1.0% of Federal Realty Investment Trust shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Summary

Federal Realty Investment Trust beats Summit Hotel Properties on 12 of the 17 factors compared between the two stocks.

About Summit Hotel Properties

Summit Hotel Properties, Inc. is a publicly traded real estate investment trust focused on owning premium-branded lodging properties with efficient operating models primarily in the upscale segment of the lodging industry. As of November 1, 2023, the Company’s portfolio consisted of 101 assets, 57 of which are wholly owned, with a total of 15,035 guestrooms located in 24 states.

About Federal Realty Investment Trust

Federal Realty Investment Trust is an equity real estate investment trust, which engages in the provision of ownership, management, and redevelopment of retail and mixed-use properties located primarily in communities where demand exceeds supply in strategically selected metropolitan markets. The company was founded in 1962 and is headquartered in North Bethesda, MD.