RLJ LODGING TRUST (RLJ) Stock Fundamental Analysis
NYSE:RLJ - New York Stock Exchange, Inc. - US74965L1017 - REIT - Currency: USD
We assign a fundamental rating of 4 out of 10 to RLJ. RLJ was compared to 130 industry peers in the Diversified REITs industry. The financial health of RLJ is average, but there are quite some concerns on its profitability. RLJ is valued correctly, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
In the past year RLJ was profitable.
RLJ had a positive operating cash flow in the past year.
In multiple years RLJ reported negative net income over the last 5 years.
RLJ had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
RLJ has a Return On Assets (0.86%) which is comparable to the rest of the industry.
With a Return On Equity value of 1.84%, RLJ perfoms like the industry average, outperforming 53.08% of the companies in the same industry.
RLJ's Return On Invested Capital of 2.60% is in line compared to the rest of the industry. RLJ outperforms 48.46% of its industry peers.
RLJ had an Average Return On Invested Capital over the past 3 years of 2.42%. This is in line with the industry average of 3.20%.
The 3 year average ROIC (2.42%) for RLJ is below the current ROIC(2.60%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.86% | ||
| ROE | 1.84% | ||
| ROIC | 2.6% |
ROA(3y)0.74%
ROA(5y)-2.37%
ROE(3y)1.57%
ROE(5y)-5.03%
ROIC(3y)2.42%
ROIC(5y)N/A
1.3 Margins
RLJ's Profit Margin of 3.07% is in line compared to the rest of the industry. RLJ outperforms 49.23% of its industry peers.
RLJ's Profit Margin has declined in the last couple of years.
With a Operating Margin value of 10.97%, RLJ is not doing good in the industry: 75.38% of the companies in the same industry are doing better.
RLJ's Operating Margin has declined in the last couple of years.
With a Gross Margin value of 35.89%, RLJ is not doing good in the industry: 84.62% of the companies in the same industry are doing better.
RLJ's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.97% | ||
| PM (TTM) | 3.07% | ||
| GM | 35.89% |
OM growth 3YN/A
OM growth 5Y-5.9%
PM growth 3YN/A
PM growth 5Y-13.88%
GM growth 3Y0.95%
GM growth 5Y-1.59%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), RLJ is destroying value.
The number of shares outstanding for RLJ has been reduced compared to 1 year ago.
The number of shares outstanding for RLJ has been reduced compared to 5 years ago.
Compared to 1 year ago, RLJ has a worse debt to assets ratio.
2.2 Solvency
RLJ has an Altman-Z score of 0.35. This is a bad value and indicates that RLJ is not financially healthy and even has some risk of bankruptcy.
RLJ has a Altman-Z score (0.35) which is in line with its industry peers.
The Debt to FCF ratio of RLJ is 14.91, which is on the high side as it means it would take RLJ, 14.91 years of fcf income to pay off all of its debts.
RLJ has a better Debt to FCF ratio (14.91) than 82.31% of its industry peers.
RLJ has a Debt/Equity ratio of 0.97. This is a neutral value indicating RLJ is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.97, RLJ is in line with its industry, outperforming 59.23% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.97 | ||
| Debt/FCF | 14.91 | ||
| Altman-Z | 0.35 |
ROIC/WACC0.38
WACC6.77%
2.3 Liquidity
A Current Ratio of 1.46 indicates that RLJ should not have too much problems paying its short term obligations.
The Current ratio of RLJ (1.46) is better than 63.08% of its industry peers.
A Quick Ratio of 1.46 indicates that RLJ should not have too much problems paying its short term obligations.
With a decent Quick ratio value of 1.46, RLJ is doing good in the industry, outperforming 63.85% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.46 | ||
| Quick Ratio | 1.46 |
3. Growth
3.1 Past
RLJ shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -15.62%.
Measured over the past years, RLJ shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -14.76% on average per year.
RLJ shows a small growth in Revenue. In the last year, the Revenue has grown by 3.31%.
Measured over the past years, RLJ shows a decrease in Revenue. The Revenue has been decreasing by -2.65% on average per year.
EPS 1Y (TTM)-15.62%
EPS 3YN/A
EPS 5Y-14.76%
EPS Q2Q%-200%
Revenue 1Y (TTM)3.31%
Revenue growth 3Y20.35%
Revenue growth 5Y-2.65%
Sales Q2Q%3.22%
3.2 Future
RLJ is expected to show a very negative growth in Earnings Per Share. In the coming years, the EPS will decrease by -22.64% yearly.
Based on estimates for the next years, RLJ will show a small growth in Revenue. The Revenue will grow by 2.59% on average per year.
EPS Next Y-46.13%
EPS Next 2Y-22.64%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year2.03%
Revenue Next 2Y2.3%
Revenue Next 3Y2.59%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 25.78, RLJ can be considered very expensive at the moment.
Based on the Price/Earnings ratio, RLJ is valued a bit cheaper than 68.46% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 28.29, RLJ is valued at the same level.
RLJ is valuated quite expensively with a Price/Forward Earnings ratio of 47.85.
Based on the Price/Forward Earnings ratio, RLJ is valued a bit cheaper than the industry average as 62.31% of the companies are valued more expensively.
RLJ's Price/Forward Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 21.08.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.78 | ||
| Fwd PE | 47.85 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, RLJ is valued cheaply inside the industry as 90.00% of the companies are valued more expensively.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of RLJ indicates a rather cheap valuation: RLJ is cheaper than 90.77% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 7.09 | ||
| EV/EBITDA | 8.69 |
4.3 Compensation for Growth
RLJ's earnings are expected to decrease with -22.64% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-22.64%
EPS Next 3YN/A
5. Dividend
5.1 Amount
RLJ has a Yearly Dividend Yield of 8.62%, which is a nice return.
In the last 3 months the price of RLJ has falen by -29.77%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
RLJ's Dividend Yield is a higher than the industry average which is at 28.61.
RLJ's Dividend Yield is rather good when compared to the S&P500 average which is at 2.52.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 8.62% |
5.2 History
The dividend of RLJ decreases each year by -16.05%.
RLJ has been paying a dividend for at least 10 years, so it has a reliable track record.
RLJ has decreased its dividend in the last 3 years.
Dividend Growth(5Y)-16.05%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
RLJ pays out 226.77% of its income as dividend. This is not a sustainable payout ratio.
The Dividend Rate of RLJ has been decling, while earnings will also be declining. This means the current dividend is most likely not sustainable.
DP226.77%
EPS Next 2Y-22.64%
EPS Next 3YN/A
6.96
+0.2 (+2.96%)
Chartmill FA Rating
GICS SectorReal Estate
GICS IndustryGroupEquity Real Estate Investment Trusts (REITs)
GICS IndustryDiversified REITs
Earnings (Last)
Earnings (Next)
Inst Owners98.75%
Inst Owner Change0%
Ins Owners2.86%
Ins Owner Change8.11%
Market Cap1.06B
Analysts70
Price Target11.19 (60.78%)
Short Float %8.72%
Short Ratio7.22
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 8.62% |
Yearly Dividend0.62
Dividend Growth(5Y)-16.05%
DP226.77%
Div Incr Years2
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)1770.39%
Min EPS beat(2)76.43%
Max EPS beat(2)3464.36%
EPS beat(4)4
Avg EPS beat(4)898.13%
Min EPS beat(4)17.49%
Max EPS beat(4)3464.36%
EPS beat(8)8
Avg EPS beat(8)578.8%
EPS beat(12)12
Avg EPS beat(12)404.89%
EPS beat(16)14
Avg EPS beat(16)272.83%
Revenue beat(2)1
Avg Revenue beat(2)0.18%
Min Revenue beat(2)-0.24%
Max Revenue beat(2)0.59%
Revenue beat(4)1
Avg Revenue beat(4)-0.03%
Min Revenue beat(4)-0.48%
Max Revenue beat(4)0.59%
Revenue beat(8)4
Avg Revenue beat(8)0.39%
Revenue beat(12)7
Avg Revenue beat(12)0.37%
Revenue beat(16)11
Avg Revenue beat(16)0.97%
PT rev (1m)-3.31%
PT rev (3m)-4.1%
EPS NQ rev (1m)-10%
EPS NQ rev (3m)-10%
EPS NY rev (1m)-22.58%
EPS NY rev (3m)-24.21%
Revenue NQ rev (1m)-0.47%
Revenue NQ rev (3m)-0.58%
Revenue NY rev (1m)-0.28%
Revenue NY rev (3m)-0.21%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.78 | ||
| Fwd PE | 47.85 | ||
| P/S | 0.77 | ||
| P/FCF | 7.09 | ||
| P/OCF | 3.7 | ||
| P/B | 0.46 | ||
| P/tB | 0.46 | ||
| EV/EBITDA | 8.69 |
EPS(TTM)0.27
EY3.88%
EPS(NY)0.15
Fwd EY2.09%
FCF(TTM)0.98
FCFY14.11%
OCF(TTM)1.88
OCFY27.03%
SpS9.03
BVpS15.06
TBVpS15.06
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.86% | ||
| ROE | 1.84% | ||
| ROCE | 3.3% | ||
| ROIC | 2.6% | ||
| ROICexc | 2.86% | ||
| ROICexgc | 2.86% | ||
| OM | 10.97% | ||
| PM (TTM) | 3.07% | ||
| GM | 35.89% | ||
| FCFM | 10.88% |
ROA(3y)0.74%
ROA(5y)-2.37%
ROE(3y)1.57%
ROE(5y)-5.03%
ROIC(3y)2.42%
ROIC(5y)N/A
ROICexc(3y)2.7%
ROICexc(5y)N/A
ROICexgc(3y)2.7%
ROICexgc(5y)N/A
ROCE(3y)3.07%
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5Y-6.39%
ROICexc growth 3YN/A
ROICexc growth 5Y-6.39%
OM growth 3YN/A
OM growth 5Y-5.9%
PM growth 3YN/A
PM growth 5Y-13.88%
GM growth 3Y0.95%
GM growth 5Y-1.59%
F-Score5
Asset Turnover0.28
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.97 | ||
| Debt/FCF | 14.91 | ||
| Debt/EBITDA | 6.73 | ||
| Cap/Depr | 76.06% | ||
| Cap/Sales | 9.97% | ||
| Interest Coverage | 1.45 | ||
| Cash Conversion | 86.58% | ||
| Profit Quality | 354.51% | ||
| Current Ratio | 1.46 | ||
| Quick Ratio | 1.46 | ||
| Altman-Z | 0.35 |
F-Score5
WACC6.77%
ROIC/WACC0.38
Cap/Depr(3y)83.09%
Cap/Depr(5y)81.14%
Cap/Sales(3y)11.78%
Cap/Sales(5y)15.84%
Profit Quality(3y)384.24%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-15.62%
EPS 3YN/A
EPS 5Y-14.76%
EPS Q2Q%-200%
EPS Next Y-46.13%
EPS Next 2Y-22.64%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)3.31%
Revenue growth 3Y20.35%
Revenue growth 5Y-2.65%
Sales Q2Q%3.22%
Revenue Next Year2.03%
Revenue Next 2Y2.3%
Revenue Next 3Y2.59%
Revenue Next 5YN/A
EBIT growth 1Y-1.59%
EBIT growth 3YN/A
EBIT growth 5Y-8.39%
EBIT Next Year140.58%
EBIT Next 3Y35.6%
EBIT Next 5YN/A
FCF growth 1Y-18.52%
FCF growth 3YN/A
FCF growth 5Y-9.09%
OCF growth 1Y-9.43%
OCF growth 3Y87.93%
OCF growth 5Y-6.4%