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 129 industry peers in the Diversified REITs industry. RLJ scores quite bad on profitability, while its financial health is fine. Not spectacular, but in line with the averages. RLJ has a expensive valuation and it also scores bad on growth.
1. Profitability
1.1 Basic Checks
RLJ had positive earnings in the past year.
In the past year RLJ had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: RLJ reported negative net income in multiple years.
RLJ had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
RLJ has a Return On Assets (0.84%) which is in line with its industry peers.
RLJ has a Return On Equity (1.80%) which is comparable to the rest of the industry.
RLJ has a Return On Invested Capital of 2.67%. This is comparable to the rest of the industry: RLJ outperforms 48.06% 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 3.15%.
The last Return On Invested Capital (2.67%) for RLJ is above the 3 year average (2.42%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.84% | ||
| ROE | 1.8% | ||
| ROIC | 2.67% |
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 has a Profit Margin (2.93%) which is comparable to the rest of the industry.
In the last couple of years the Profit Margin of RLJ has declined.
RLJ has a worse Operating Margin (11.09%) than 75.19% of its industry peers.
In the last couple of years the Operating Margin of RLJ has declined.
RLJ has a worse Gross Margin (35.80%) than 85.27% of its industry peers.
RLJ's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.09% | ||
| PM (TTM) | 2.93% | ||
| GM | 35.8% |
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
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so RLJ is destroying value.
RLJ has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, RLJ has less shares outstanding
Compared to 1 year ago, RLJ has a worse debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 0.35, we must say that RLJ is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of RLJ (0.35) is worse than 60.47% of its industry peers.
RLJ has a debt to FCF ratio of 16.90. This is a negative value and a sign of low solvency as RLJ would need 16.90 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 16.90, RLJ belongs to the top of the industry, outperforming 83.72% of the companies in the same industry.
RLJ has a Debt/Equity ratio of 0.99. This is a neutral value indicating RLJ is somewhat dependend on debt financing.
RLJ has a Debt to Equity ratio (0.99) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.99 | ||
| Debt/FCF | 16.9 | ||
| Altman-Z | 0.35 |
ROIC/WACC0.41
WACC6.55%
2.3 Liquidity
A Current Ratio of 1.40 indicates that RLJ should not have too much problems paying its short term obligations.
The Current ratio of RLJ (1.40) is better than 68.99% of its industry peers.
A Quick Ratio of 1.40 indicates that RLJ should not have too much problems paying its short term obligations.
With a decent Quick ratio value of 1.40, RLJ is doing good in the industry, outperforming 69.77% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.4 | ||
| Quick Ratio | 1.4 |
3. Growth
3.1 Past
The earnings per share for RLJ have decreased strongly by -10.71% in the last year.
RLJ shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -14.76% yearly.
The Revenue has been growing slightly by 2.82% in the past year.
RLJ shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -2.65% yearly.
EPS 1Y (TTM)-10.71%
EPS 3YN/A
EPS 5Y-14.76%
EPS Q2Q%-200%
Revenue 1Y (TTM)2.82%
Revenue growth 3Y20.35%
Revenue growth 5Y-2.65%
Sales Q2Q%1.14%
3.2 Future
Based on estimates for the next years, RLJ will show a very negative growth in Earnings Per Share. The EPS will decrease by -50.39% on average per year.
The Revenue is expected to grow by 2.59% on average over the next years.
EPS Next Y-111.22%
EPS Next 2Y-50.39%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year-0.15%
Revenue Next 2Y0.76%
Revenue Next 3Y2.59%
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 decreasing.
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
RLJ is valuated quite expensively with a Price/Earnings ratio of 29.20.
Based on the Price/Earnings ratio, RLJ is valued a bit cheaper than 63.57% of the companies in the same industry.
RLJ is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 26.25, which is the current average of the S&P500 Index.
The Forward Price/Earnings Ratio is negative for RLJ. No positive earnings are expected for the next year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.2 | ||
| Fwd PE | N/A |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, RLJ is valued cheaper than 89.92% of the companies in the same industry.
RLJ's Price/Free Cash Flow ratio is rather cheap when compared to the industry. RLJ is cheaper than 94.57% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.42 | ||
| EV/EBITDA | 8.96 |
4.3 Compensation for Growth
A cheap valuation may be justified as RLJ's earnings are expected to decrease with -50.39% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-50.39%
EPS Next 3YN/A
5. Dividend
5.1 Amount
RLJ has a Yearly Dividend Yield of 8.22%, which is a nice return.
The stock price of RLJ dropped by -21.17% in the last 3 months. With lower prices the dividend yield is higher, but it may be a sign investors do not trust the long term dividend.
Compared to an average industry Dividend Yield of 6.68, RLJ pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.38, RLJ pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 8.22% |
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 not decreased its dividend in the last 3 years.
Dividend Growth(5Y)-16.05%
Div Incr Years3
Div Non Decr Years4
5.3 Sustainability
RLJ pays out 255.98% 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.
DP255.98%
EPS Next 2Y-50.39%
EPS Next 3YN/A
7.3
0 (0%)
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 Change-3.03%
Ins Owners2.86%
Ins Owner Change9.4%
Market Cap1.11B
Analysts70
Price Target10.23 (40.14%)
Short Float %8.18%
Short Ratio4.03
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 8.22% |
Yearly Dividend0.62
Dividend Growth(5Y)-16.05%
DP255.98%
Div Incr Years3
Div Non Decr Years4
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)54.46%
Min EPS beat(2)32.49%
Max EPS beat(2)76.43%
EPS beat(4)4
Avg EPS beat(4)901.88%
Min EPS beat(4)32.49%
Max EPS beat(4)3464.36%
EPS beat(8)8
Avg EPS beat(8)533.23%
EPS beat(12)12
Avg EPS beat(12)406.71%
EPS beat(16)14
Avg EPS beat(16)274.59%
Revenue beat(2)1
Avg Revenue beat(2)-0.14%
Min Revenue beat(2)-0.87%
Max Revenue beat(2)0.59%
Revenue beat(4)1
Avg Revenue beat(4)-0.13%
Min Revenue beat(4)-0.87%
Max Revenue beat(4)0.59%
Revenue beat(8)3
Avg Revenue beat(8)0.06%
Revenue beat(12)6
Avg Revenue beat(12)0.27%
Revenue beat(16)10
Avg Revenue beat(16)0.64%
PT rev (1m)0%
PT rev (3m)-12.3%
EPS NQ rev (1m)-48.63%
EPS NQ rev (3m)-56.9%
EPS NY rev (1m)-120.55%
EPS NY rev (3m)-116.13%
Revenue NQ rev (1m)-3.02%
Revenue NQ rev (3m)-3.6%
Revenue NY rev (1m)-1.57%
Revenue NY rev (3m)-2.48%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.2 | ||
| Fwd PE | N/A | ||
| P/S | 0.81 | ||
| P/FCF | 8.42 | ||
| P/OCF | 3.94 | ||
| P/B | 0.5 | ||
| P/tB | 0.5 | ||
| EV/EBITDA | 8.96 |
EPS(TTM)0.25
EY3.42%
EPS(NY)-0.07
Fwd EYN/A
FCF(TTM)0.87
FCFY11.87%
OCF(TTM)1.85
OCFY25.37%
SpS9.05
BVpS14.73
TBVpS14.73
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.84% | ||
| ROE | 1.8% | ||
| ROCE | 3.38% | ||
| ROIC | 2.67% | ||
| ROICexc | 2.89% | ||
| ROICexgc | 2.89% | ||
| OM | 11.09% | ||
| PM (TTM) | 2.93% | ||
| GM | 35.8% | ||
| FCFM | 9.57% |
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 Turnover0.29
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.99 | ||
| Debt/FCF | 16.9 | ||
| Debt/EBITDA | 6.67 | ||
| Cap/Depr | 82.8% | ||
| Cap/Sales | 10.89% | ||
| Interest Coverage | 1.45 | ||
| Cash Conversion | 84.4% | ||
| Profit Quality | 326.73% | ||
| Current Ratio | 1.4 | ||
| Quick Ratio | 1.4 | ||
| Altman-Z | 0.35 |
F-Score5
WACC6.55%
ROIC/WACC0.41
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)-10.71%
EPS 3YN/A
EPS 5Y-14.76%
EPS Q2Q%-200%
EPS Next Y-111.22%
EPS Next 2Y-50.39%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)2.82%
Revenue growth 3Y20.35%
Revenue growth 5Y-2.65%
Sales Q2Q%1.14%
Revenue Next Year-0.15%
Revenue Next 2Y0.76%
Revenue Next 3Y2.59%
Revenue Next 5YN/A
EBIT growth 1Y4.51%
EBIT growth 3YN/A
EBIT growth 5Y-8.39%
EBIT Next Year132.64%
EBIT Next 3Y35.6%
EBIT Next 5YN/A
FCF growth 1Y36.52%
FCF growth 3YN/A
FCF growth 5Y-9.09%
OCF growth 1Y-2.51%
OCF growth 3Y87.93%
OCF growth 5Y-6.4%