DIAMONDROCK HOSPITALITY CO (DRH) Stock Fundamental Analysis
NYSE:DRH - New York Stock Exchange, Inc. - US2527843013 - REIT - Currency: USD
We assign a fundamental rating of 4 out of 10 to DRH. DRH was compared to 130 industry peers in the Diversified REITs industry. DRH has only an average score on both its financial health and profitability. DRH has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
DRH had positive earnings in the past year.
DRH had a positive operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: DRH reported negative net income in multiple years.
In multiple years DRH reported negative operating cash flow during the last 5 years.
1.2 Ratios
DRH has a better Return On Assets (1.90%) than 67.72% of its industry peers.
DRH has a better Return On Equity (3.66%) than 64.57% of its industry peers.
With a decent Return On Invested Capital value of 3.67%, DRH is doing good in the industry, outperforming 70.87% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.9% | ||
| ROE | 3.66% | ||
| ROIC | 3.67% |
ROA(3y)-0.48%
ROA(5y)-1.74%
ROE(3y)-0.86%
ROE(5y)-3.24%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
With a Profit Margin value of 5.42%, DRH perfoms like the industry average, outperforming 50.39% of the companies in the same industry.
DRH's Profit Margin has declined in the last couple of years.
DRH's Operating Margin of 12.06% is on the low side compared to the rest of the industry. DRH is outperformed by 74.02% of its industry peers.
In the last couple of years the Operating Margin of DRH has grown nicely.
DRH has a Gross Margin of 27.24%. This is amonst the worse of the industry: DRH underperforms 92.13% of its industry peers.
In the last couple of years the Gross Margin of DRH has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.06% | ||
| PM (TTM) | 5.42% | ||
| GM | 27.24% |
OM growth 3YN/A
OM growth 5Y2%
PM growth 3YN/A
PM growth 5Y-6.88%
GM growth 3YN/A
GM growth 5Y0.2%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so DRH is destroying value.
DRH has about the same amout of shares outstanding than it did 1 year ago.
DRH has more shares outstanding than it did 5 years ago.
The debt/assets ratio for DRH has been reduced compared to a year ago.
2.2 Solvency
DRH has an Altman-Z score of 0.93. This is a bad value and indicates that DRH is not financially healthy and even has some risk of bankruptcy.
With a decent Altman-Z score value of 0.93, DRH is doing good in the industry, outperforming 69.29% of the companies in the same industry.
The Debt to FCF ratio of DRH is 8.89, which is on the high side as it means it would take DRH, 8.89 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of DRH (8.89) is better than 90.55% of its industry peers.
DRH has a Debt/Equity ratio of 0.67. This is a neutral value indicating DRH is somewhat dependend on debt financing.
DRH's Debt to Equity ratio of 0.67 is fine compared to the rest of the industry. DRH outperforms 78.74% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.67 | ||
| Debt/FCF | 8.89 | ||
| Altman-Z | 0.93 |
ROIC/WACC0.51
WACC7.14%
2.3 Liquidity
DRH has a Current Ratio of 1.09. This is a normal value and indicates that DRH is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.09, DRH is in line with its industry, outperforming 46.46% of the companies in the same industry.
DRH has a Quick Ratio of 1.09. This is a normal value and indicates that DRH is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.09, DRH is in line with its industry, outperforming 48.03% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.09 | ||
| Quick Ratio | 1.09 |
3. Growth
3.1 Past
DRH shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -25.64%.
DRH shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -3.04% yearly.
DRH shows a small growth in Revenue. In the last year, the Revenue has grown by 4.50%.
DRH shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.47% yearly.
EPS 1Y (TTM)-25.64%
EPS 3YN/A
EPS 5Y-3.04%
EPS Q2Q%0%
Revenue 1Y (TTM)4.5%
Revenue growth 3Y53.1%
Revenue growth 5Y4.47%
Sales Q2Q%3.11%
3.2 Future
Based on estimates for the next years, DRH will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.17% on average per year.
The Revenue is expected to grow by 3.42% on average over the next years.
EPS Next Y-12.09%
EPS Next 2Y14.83%
EPS Next 3Y10.17%
EPS Next 5YN/A
Revenue Next Year4.62%
Revenue Next 2Y3.67%
Revenue Next 3Y3.42%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
DRH is valuated quite expensively with a Price/Earnings ratio of 29.79.
Based on the Price/Earnings ratio, DRH is valued a bit cheaper than 66.93% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 28.47. DRH is around the same levels.
With a Price/Forward Earnings ratio of 18.20, DRH is valued on the expensive side.
Based on the Price/Forward Earnings ratio, DRH is valued cheaper than 93.70% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 92.74, DRH is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.79 | ||
| Fwd PE | 18.2 |
4.2 Price Multiples
DRH's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. DRH is cheaper than 75.59% of the companies in the same industry.
83.46% of the companies in the same industry are more expensive than DRH, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 14.53 | ||
| EV/EBITDA | 11.37 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y14.83%
EPS Next 3Y10.17%
5. Dividend
5.1 Amount
DRH has a Yearly Dividend Yield of 1.36%.
Compared to an average industry Dividend Yield of 18.71, DRH's dividend is way lower than its industry peers. On top of this 90.55% of the companies listed in the same industry pay a better dividend than DRH!
Compared to an average S&P500 Dividend Yield of 2.28, DRH's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.36% |
5.2 History
The dividend of DRH decreases each year by -17.06%.
DRH has paid a dividend for at least 10 years, which is a reliable track record.
DRH has decreased its dividend recently.
Dividend Growth(5Y)-17.06%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
DRH pays out 58.73% of its income as dividend. This is a bit on the high side, but may be sustainable.
DP58.73%
EPS Next 2Y14.83%
EPS Next 3Y10.17%
DIAMONDROCK HOSPITALITY CO
NYSE:DRH (2/4/2025, 8:04:00 PM)
After market: 8.64 0 (0%)8.64
+0.02 (+0.23%)
Chartmill FA Rating
GICS SectorReal Estate
GICS IndustryGroupEquity Real Estate Investment Trusts (REITs)
GICS IndustryDiversified REITs
Earnings (Last)
Earnings (Next)
Inst Owners106.65%
Inst Owner Change-2.58%
Ins Owners0.76%
Ins Owner Change0.27%
Market Cap1.79B
Analysts71.25
Price Target10.5 (21.53%)
Short Float %8.3%
Short Ratio7.27
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.36% |
Yearly Dividend0.2
Dividend Growth(5Y)-17.06%
DP58.73%
Div Incr Years1
Div Non Decr Years1
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-23.78%
Min EPS beat(2)-42.6%
Max EPS beat(2)-4.95%
EPS beat(4)1
Avg EPS beat(4)-6.88%
Min EPS beat(4)-42.6%
Max EPS beat(4)32.01%
EPS beat(8)2
Avg EPS beat(8)-9.36%
EPS beat(12)5
Avg EPS beat(12)17.2%
EPS beat(16)8
Avg EPS beat(16)17.82%
Revenue beat(2)1
Avg Revenue beat(2)-0.03%
Min Revenue beat(2)-1.53%
Max Revenue beat(2)1.47%
Revenue beat(4)2
Avg Revenue beat(4)0.44%
Min Revenue beat(4)-1.53%
Max Revenue beat(4)2%
Revenue beat(8)5
Avg Revenue beat(8)0.54%
Revenue beat(12)9
Avg Revenue beat(12)2.03%
Revenue beat(16)12
Avg Revenue beat(16)3.25%
PT rev (1m)0%
PT rev (3m)4.86%
EPS NQ rev (1m)8.33%
EPS NQ rev (3m)-31.58%
EPS NY rev (1m)2.17%
EPS NY rev (3m)-10.48%
Revenue NQ rev (1m)-0.03%
Revenue NQ rev (3m)-1.06%
Revenue NY rev (1m)0.09%
Revenue NY rev (3m)-0.18%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.79 | ||
| Fwd PE | 18.2 | ||
| P/S | 1.61 | ||
| P/FCF | 14.53 | ||
| P/OCF | 8.9 | ||
| P/B | 1.09 | ||
| P/tB | 1.09 | ||
| EV/EBITDA | 11.37 |
EPS(TTM)0.29
EY3.36%
EPS(NY)0.47
Fwd EY5.49%
FCF(TTM)0.59
FCFY6.88%
OCF(TTM)0.97
OCFY11.23%
SpS5.37
BVpS7.94
TBVpS7.94
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.9% | ||
| ROE | 3.66% | ||
| ROCE | 4.64% | ||
| ROIC | 3.67% | ||
| ROICexc | 3.77% | ||
| ROICexgc | 3.77% | ||
| OM | 12.06% | ||
| PM (TTM) | 5.42% | ||
| GM | 27.24% | ||
| FCFM | 11.07% |
ROA(3y)-0.48%
ROA(5y)-1.74%
ROE(3y)-0.86%
ROE(5y)-3.24%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5Y7.28%
ROICexc growth 3YN/A
ROICexc growth 5Y7.74%
OM growth 3YN/A
OM growth 5Y2%
PM growth 3YN/A
PM growth 5Y-6.88%
GM growth 3YN/A
GM growth 5Y0.2%
F-Score6
Asset Turnover0.35
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.67 | ||
| Debt/FCF | 8.89 | ||
| Debt/EBITDA | 4.44 | ||
| Cap/Depr | 69.19% | ||
| Cap/Sales | 7.01% | ||
| Interest Coverage | 2.09 | ||
| Cash Conversion | 81.49% | ||
| Profit Quality | 204.26% | ||
| Current Ratio | 1.09 | ||
| Quick Ratio | 1.09 | ||
| Altman-Z | 0.93 |
F-Score6
WACC7.14%
ROIC/WACC0.51
Cap/Depr(3y)127.89%
Cap/Depr(5y)126.11%
Cap/Sales(3y)14.83%
Cap/Sales(5y)19.13%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-25.64%
EPS 3YN/A
EPS 5Y-3.04%
EPS Q2Q%0%
EPS Next Y-12.09%
EPS Next 2Y14.83%
EPS Next 3Y10.17%
EPS Next 5YN/A
Revenue 1Y (TTM)4.5%
Revenue growth 3Y53.1%
Revenue growth 5Y4.47%
Sales Q2Q%3.11%
Revenue Next Year4.62%
Revenue Next 2Y3.67%
Revenue Next 3Y3.42%
Revenue Next 5YN/A
EBIT growth 1Y-15.6%
EBIT growth 3YN/A
EBIT growth 5Y6.56%
EBIT Next Year84.12%
EBIT Next 3Y24.12%
EBIT Next 5YN/A
FCF growth 1Y856.71%
FCF growth 3YN/A
FCF growth 5Y2.65%
OCF growth 1Y13.16%
OCF growth 3YN/A
OCF growth 5Y1.77%