SUNSTONE HOTEL INVESTORS INC (SHO) Stock Fundamental Analysis
USA - NYSE:SHO - US8678921011 - REIT
9.78 USD
+0.36 (+3.82%)
9.78 USD
0 (0%)
SHO gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 130 industry peers in the Diversified REITs industry. While SHO seems to be doing ok healthwise, there are quite some concerns on its profitability. SHO does not seem to be growing, but still is valued expensively.
1. Profitability
1.1 Basic Checks
SHO had positive earnings in the past year.
In the past year SHO had a positive cash flow from operations.
SHO had positive earnings in 4 of the past 5 years.
Of the past 5 years SHO 4 years had a positive operating cash flow.
1.2 Ratios
SHO has a Return On Assets (0.14%) which is comparable to the rest of the industry.
SHO has a Return On Equity (0.21%) which is comparable to the rest of the industry.
The Return On Invested Capital of SHO (2.00%) is worse than 64.62% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for SHO is in line with the industry average of 3.05%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.14% | ||
| ROE | 0.21% | ||
| ROIC | 2% |
ROA(3y)3.11%
ROA(5y)-0.84%
ROE(3y)4.55%
ROE(5y)-1.22%
ROIC(3y)2.7%
ROIC(5y)N/A
1.3 Margins
SHO has a Profit Margin (0.44%) which is in line with its industry peers.
SHO's Profit Margin has declined in the last couple of years.
The Operating Margin of SHO (7.77%) is worse than 81.54% of its industry peers.
In the last couple of years the Operating Margin of SHO has declined.
Looking at the Gross Margin, with a value of 60.49%, SHO is doing worse than 66.15% of the companies in the same industry.
SHO's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 7.77% | ||
| PM (TTM) | 0.44% | ||
| GM | 60.49% |
OM growth 3YN/A
OM growth 5Y-9.81%
PM growth 3Y4.77%
PM growth 5Y-22.47%
GM growth 3Y-0.55%
GM growth 5Y-0.8%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), SHO is destroying value.
SHO has less shares outstanding than it did 1 year ago.
The number of shares outstanding for SHO has been reduced compared to 5 years ago.
Compared to 1 year ago, SHO has a worse debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 1.21, we must say that SHO is in the distress zone and has some risk of bankruptcy.
With an excellent Altman-Z score value of 1.21, SHO belongs to the best of the industry, outperforming 83.85% of the companies in the same industry.
SHO has a debt to FCF ratio of 5.18. This is a neutral value as SHO would need 5.18 years to pay back of all of its debts.
The Debt to FCF ratio of SHO (5.18) is better than 98.46% of its industry peers.
A Debt/Equity ratio of 0.44 indicates that SHO is not too dependend on debt financing.
SHO has a Debt to Equity ratio of 0.44. This is amongst the best in the industry. SHO outperforms 91.54% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.44 | ||
| Debt/FCF | 5.18 | ||
| Altman-Z | 1.21 |
ROIC/WACC0.27
WACC7.46%
2.3 Liquidity
SHO has a Current Ratio of 1.30. This is a normal value and indicates that SHO is financially healthy and should not expect problems in meeting its short term obligations.
SHO has a Current ratio (1.30) which is comparable to the rest of the industry.
SHO has a Quick Ratio of 1.30. This is a normal value and indicates that SHO is financially healthy and should not expect problems in meeting its short term obligations.
With a Quick ratio value of 1.30, SHO perfoms like the industry average, outperforming 59.23% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.3 | ||
| Quick Ratio | 1.3 |
3. Growth
3.1 Past
The earnings per share for SHO have decreased strongly by -90.91% in the last year.
Measured over the past years, SHO shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -23.38% on average per year.
Looking at the last year, SHO shows a small growth in Revenue. The Revenue has grown by 0.37% in the last year.
The Revenue has been decreasing by -4.07% on average over the past years.
EPS 1Y (TTM)-90.91%
EPS 3Y29.76%
EPS 5Y-23.38%
EPS Q2Q%-72.73%
Revenue 1Y (TTM)0.37%
Revenue growth 3Y21.17%
Revenue growth 5Y-4.07%
Sales Q2Q%4.97%
3.2 Future
Based on estimates for the next years, SHO will show a quite strong growth in Earnings Per Share. The EPS will grow by 13.00% on average per year.
The Revenue is expected to grow by 4.27% on average over the next years.
EPS Next Y-69.34%
EPS Next 2Y-10.92%
EPS Next 3Y13%
EPS Next 5YN/A
Revenue Next Year5.94%
Revenue Next 2Y4.91%
Revenue Next 3Y4.27%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 489.00, SHO can be considered very expensive at the moment.
Based on the Price/Earnings ratio, SHO is valued a bit more expensive than 60.77% of the companies in the same industry.
When comparing the Price/Earnings ratio of SHO to the average of the S&P500 Index (27.30), we can say SHO is valued expensively.
With a Price/Forward Earnings ratio of 88.03, SHO can be considered very expensive at the moment.
SHO's Price/Forward Earnings is on the same level as the industry average.
SHO's Price/Forward Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 22.73.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 489 | ||
| Fwd PE | 88.03 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of SHO indicates a somewhat cheap valuation: SHO is cheaper than 69.23% of the companies listed in the same industry.
89.23% of the companies in the same industry are more expensive than SHO, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.07 | ||
| EV/EBITDA | 13.04 |
4.3 Compensation for Growth
A more expensive valuation may be justified as SHO's earnings are expected to grow with 13.00% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-10.92%
EPS Next 3Y13%
5. Dividend
5.1 Amount
SHO has a Yearly Dividend Yield of 3.82%.
Compared to an average industry Dividend Yield of 6.66, SHO is paying slightly less dividend.
SHO's Dividend Yield is rather good when compared to the S&P500 average which is at 2.38.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.82% |
5.2 History
The dividend of SHO decreases each year by -9.74%.
SHO has paid a dividend for at least 10 years, which is a reliable track record.
The dividend of SHO decreased in the last 3 years.
Dividend Growth(5Y)-9.74%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
2126.95% of the earnings are spent on dividend by SHO. This is not a sustainable payout ratio.
DP2126.95%
EPS Next 2Y-10.92%
EPS Next 3Y13%
9.78
+0.36 (+3.82%)
Chartmill FA Rating
GICS SectorReal Estate
GICS IndustryGroupEquity Real Estate Investment Trusts (REITs)
GICS IndustryDiversified REITs
Earnings (Last)
Earnings (Next)
Inst Owners102.6%
Inst Owner Change-4.41%
Ins Owners1.21%
Ins Owner Change1.7%
Market Cap1.86B
Analysts73.33
Price Target9.74 (-0.41%)
Short Float %8.18%
Short Ratio6.38
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.82% |
Yearly Dividend0.45
Dividend Growth(5Y)-9.74%
DP2126.95%
Div Incr Years2
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)49.22%
Min EPS beat(2)-65.59%
Max EPS beat(2)164.03%
EPS beat(4)2
Avg EPS beat(4)6.67%
Min EPS beat(4)-100%
Max EPS beat(4)164.03%
EPS beat(8)6
Avg EPS beat(8)345.59%
EPS beat(12)10
Avg EPS beat(12)313.01%
EPS beat(16)13
Avg EPS beat(16)247%
Revenue beat(2)0
Avg Revenue beat(2)-1.93%
Min Revenue beat(2)-3.82%
Max Revenue beat(2)-0.05%
Revenue beat(4)1
Avg Revenue beat(4)-1.44%
Min Revenue beat(4)-3.82%
Max Revenue beat(4)0.7%
Revenue beat(8)4
Avg Revenue beat(8)-0.69%
Revenue beat(12)7
Avg Revenue beat(12)0.76%
Revenue beat(16)10
Avg Revenue beat(16)1.95%
PT rev (1m)-0.94%
PT rev (3m)-3.09%
EPS NQ rev (1m)-159.99%
EPS NQ rev (3m)-159.99%
EPS NY rev (1m)-68.9%
EPS NY rev (3m)-59.72%
Revenue NQ rev (1m)-1.41%
Revenue NQ rev (3m)-3.35%
Revenue NY rev (1m)-0.69%
Revenue NY rev (3m)-1.4%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 489 | ||
| Fwd PE | 88.03 | ||
| P/S | 1.99 | ||
| P/FCF | 11.07 | ||
| P/OCF | 11.07 | ||
| P/B | 0.94 | ||
| P/tB | 0.94 | ||
| EV/EBITDA | 13.04 |
EPS(TTM)0.02
EY0.2%
EPS(NY)0.11
Fwd EY1.14%
FCF(TTM)0.88
FCFY9.04%
OCF(TTM)0.88
OCFY9.04%
SpS4.92
BVpS10.42
TBVpS10.42
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.14% | ||
| ROE | 0.21% | ||
| ROCE | 2.54% | ||
| ROIC | 2% | ||
| ROICexc | 2.06% | ||
| ROICexgc | 2.06% | ||
| OM | 7.77% | ||
| PM (TTM) | 0.44% | ||
| GM | 60.49% | ||
| FCFM | 17.95% |
ROA(3y)3.11%
ROA(5y)-0.84%
ROE(3y)4.55%
ROE(5y)-1.22%
ROIC(3y)2.7%
ROIC(5y)N/A
ROICexc(3y)2.94%
ROICexc(5y)N/A
ROICexgc(3y)2.94%
ROICexgc(5y)N/A
ROCE(3y)3.42%
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5Y-13.98%
ROICexc growth 3YN/A
ROICexc growth 5Y-13.98%
OM growth 3YN/A
OM growth 5Y-9.81%
PM growth 3Y4.77%
PM growth 5Y-22.47%
GM growth 3Y-0.55%
GM growth 5Y-0.8%
F-Score5
Asset Turnover0.31
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.44 | ||
| Debt/FCF | 5.18 | ||
| Debt/EBITDA | 4.27 | ||
| Cap/Depr | 0% | ||
| Cap/Sales | 0% | ||
| Interest Coverage | 1.57 | ||
| Cash Conversion | 82.51% | ||
| Profit Quality | 4053.66% | ||
| Current Ratio | 1.3 | ||
| Quick Ratio | 1.3 | ||
| Altman-Z | 1.21 |
F-Score5
WACC7.46%
ROIC/WACC0.27
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-90.91%
EPS 3Y29.76%
EPS 5Y-23.38%
EPS Q2Q%-72.73%
EPS Next Y-69.34%
EPS Next 2Y-10.92%
EPS Next 3Y13%
EPS Next 5YN/A
Revenue 1Y (TTM)0.37%
Revenue growth 3Y21.17%
Revenue growth 5Y-4.07%
Sales Q2Q%4.97%
Revenue Next Year5.94%
Revenue Next 2Y4.91%
Revenue Next 3Y4.27%
Revenue Next 5YN/A
EBIT growth 1Y-25.98%
EBIT growth 3YN/A
EBIT growth 5Y-13.48%
EBIT Next Year206.36%
EBIT Next 3Y51.43%
EBIT Next 5YN/A
FCF growth 1Y-25.63%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-25.63%
OCF growth 3Y81.77%
OCF growth 5Y-10.15%