SUNSTONE HOTEL INVESTORS INC (SHO)
US8678921011 - REIT
Taking everything into account, SHO scores 5 out of 10 in our fundamental rating. SHO was compared to 126 industry peers in the Diversified REITs industry. SHO is in great health and has no worries on liquidiy or solvency at all, but the profibility rating is only average. SHO has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
In the past year SHO was profitable.
SHO had a positive operating cash flow in the past year.
Of the past 5 years SHO 4 years were profitable.
Of the past 5 years SHO 4 years had a positive operating cash flow.
1.2 Ratios
The Return On Assets of SHO (6.09%) is better than 94.31% of its industry peers.
Looking at the Return On Equity, with a value of 8.85%, SHO belongs to the top of the industry, outperforming 83.74% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 3.11%, SHO is in the better half of the industry, outperforming 61.79% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.09% | ||
| ROE | 8.85% | ||
| ROIC | 3.11% |
ROA(3y)2.96%
ROA(5y)-0.4%
ROE(3y)4.32%
ROE(5y)-0.54%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
SHO has a Profit Margin of 19.44%. This is in the better half of the industry: SHO outperforms 72.36% of its industry peers.
In the last couple of years the Profit Margin of SHO has remained more or less at the same level.
Looking at the Operating Margin, with a value of 12.03%, SHO is doing worse than 72.36% of the companies in the same industry.
SHO's Operating Margin has declined in the last couple of years.
The Gross Margin of SHO (61.94%) is worse than 69.11% of its industry peers.
SHO's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.03% | ||
| PM (TTM) | 19.44% | ||
| GM | 61.94% |
OM growth 3YN/A
OM growth 5Y-5.33%
PM growth 3YN/A
PM growth 5Y-0.96%
GM growth 3Y11.34%
GM growth 5Y-0.56%
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.
The debt/assets ratio for SHO has been reduced compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 1.60, we must say that SHO is in the distress zone and has some risk of bankruptcy.
SHO has a Altman-Z score of 1.60. This is amongst the best in the industry. SHO outperforms 89.43% of its industry peers.
The Debt to FCF ratio of SHO is 4.11, which is a neutral value as it means it would take SHO, 4.11 years of fcf income to pay off all of its debts.
SHO has a better Debt to FCF ratio (4.11) than 99.19% of its industry peers.
SHO has a Debt/Equity ratio of 0.38. This is a healthy value indicating a solid balance between debt and equity.
SHO has a better Debt to Equity ratio (0.38) than 95.12% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.38 | ||
| Debt/FCF | 4.11 | ||
| Altman-Z | 1.6 |
ROIC/WACC0.39
WACC7.97%
2.3 Liquidity
A Current Ratio of 3.79 indicates that SHO has no problem at all paying its short term obligations.
With an excellent Current ratio value of 3.79, SHO belongs to the best of the industry, outperforming 91.87% of the companies in the same industry.
SHO has a Quick Ratio of 3.79. This indicates that SHO is financially healthy and has no problem in meeting its short term obligations.
SHO has a Quick ratio of 3.79. This is amongst the best in the industry. SHO outperforms 91.87% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.79 | ||
| Quick Ratio | 3.79 |
3. Growth
3.1 Past
The earnings per share for SHO have decreased by -5.71% 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 -20.66% on average per year.
SHO shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 8.16%.
The Revenue has been decreasing by -3.17% on average over the past years.
EPS 1Y (TTM)-5.71%
EPS 3YN/A
EPS 5Y-20.66%
EPS growth Q2Q-100%
Revenue 1Y (TTM)8.16%
Revenue growth 3Y54.42%
Revenue growth 5Y-3.17%
Revenue growth Q2Q-10.19%
3.2 Future
Based on estimates for the next years, SHO will show a decrease in Earnings Per Share. The EPS will decrease by -5.01% on average per year.
SHO is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -0.83% yearly.
EPS Next Y-22.95%
EPS Next 2Y2.61%
EPS Next 3Y-5.01%
EPS Next 5YN/A
Revenue Next Year-6.27%
Revenue Next 2Y-1.12%
Revenue Next 3Y-0.83%
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.
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
SHO is valuated quite expensively with a Price/Earnings ratio of 30.67.
61.79% of the companies in the same industry are more expensive than SHO, based on the Price/Earnings ratio.
SHO is valuated rather expensively when we compare the Price/Earnings ratio to 24.80, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 39.80, SHO can be considered very expensive at the moment.
65.04% of the companies in the same industry are more expensive than SHO, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.27, SHO is valued quite expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 30.67 | ||
| Fwd PE | 39.8 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of SHO indicates a rather cheap valuation: SHO is cheaper than 86.99% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of SHO indicates a rather cheap valuation: SHO is cheaper than 86.99% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.4 | ||
| EV/EBITDA | 9.92 |
4.3 Compensation for Growth
SHO's earnings are expected to decrease with -5.01% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y2.61%
EPS Next 3Y-5.01%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.37%, SHO has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 5.97, SHO's dividend is way lower than its industry peers. On top of this 81.30% of the companies listed in the same industry pay a better dividend than SHO!
Compared to an average S&P500 Dividend Yield of 2.40, SHO has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.37% |
5.2 History
The dividend of SHO decreases each year by -18.03%.
SHO has been paying a dividend for at least 10 years, so it has a reliable track record.
The dividend of SHO decreased recently.
Dividend Growth(5Y)-18.03%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
SHO pays out 31.20% of its income as dividend. This is a sustainable payout ratio.
The Dividend Rate of SHO has been decling, while earnings will also be declining. This means the current dividend is most likely not sustainable.
DP31.2%
EPS Next 2Y2.61%
EPS Next 3Y-5.01%
SUNSTONE HOTEL INVESTORS INC
NYSE:SHO (4/19/2024, 8:51:50 AM)
10.12
+0.06 (+0.6%)
Chartmill FA Rating
GICS SectorReal Estate
GICS IndustryGroupEquity Real Estate Investment Trusts (REITs)
GICS IndustryDiversified REITs
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap2.06B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.37% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
Avg EPS beat(4)
Min EPS beat(4)
Max EPS beat(4)
EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
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Min Revenue beat(4)
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Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
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Revenue beat(16)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 30.67 | ||
| Fwd PE | 39.8 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.09% | ||
| ROE | 8.85% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 12.03% | ||
| PM (TTM) | 19.44% | ||
| GM | 61.94% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.31
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.38 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 3.79 | ||
| Quick Ratio | 3.79 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)-5.71%
EPS 3YN/A
EPS 5Y
EPS growth Q2Q
EPS Next Y-22.95%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)8.16%
Revenue growth 3Y54.42%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y