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DiamondRock Hospitality

Executive Summary

DiamondRock Hospitality Company is a self-advised real estate investment trust (REIT) that is an owner of a leading portfolio of geographically diversified hotels concentrated in top gateway markets and destination resort locations.


Snowflake Analysis

Very undervalued with reasonable growth potential.


Similar Companies

Share Price & News

How has DiamondRock Hospitality's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: HBO's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-3.4%

HBO

-2.0%

DE REITs

0.7%

DE Market


1 Year Return

-49.4%

HBO

9.7%

DE REITs

3.9%

DE Market

Return vs Industry: HBO underperformed the German REITs industry which returned 9.7% over the past year.

Return vs Market: HBO underperformed the German Market which returned 3.9% over the past year.


Shareholder returns

HBOIndustryMarket
7 Day-3.4%-2.0%0.7%
30 Day-21.7%-1.7%5.3%
90 Day-0.4%6.0%17.3%
1 Year-48.2%-49.4%10.2%9.7%6.2%3.9%
3 Year-50.7%-56.2%-2.4%-15.4%1.8%-6.2%
5 Year-55.9%-64.5%2.7%-18.8%9.3%-5.4%

Price Volatility Vs. Market

How volatile is DiamondRock Hospitality's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is DiamondRock Hospitality undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: HBO (€4.5) is trading below our estimate of fair value (€44.14)

Significantly Below Fair Value: HBO is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: HBO is good value based on its PE Ratio (7.5x) compared to the DE REITs industry average (8.6x).

PE vs Market: HBO is good value based on its PE Ratio (7.5x) compared to the German market (21.1x).


Price to Earnings Growth Ratio

PEG Ratio: HBO is good value based on its PEG Ratio (0.2x)


Price to Book Ratio

PB vs Industry: HBO is good value based on its PB Ratio (0.6x) compared to the DE REITs industry average (1.5x).


Next Steps

Future Growth

How is DiamondRock Hospitality forecast to perform in the next 1 to 3 years based on estimates from 8 analysts?

46.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: HBO's forecast earnings growth (46.2% per year) is above the savings rate (0.2%).

Earnings vs Market: HBO's earnings (46.2% per year) are forecast to grow faster than the German market (22.3% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: HBO's revenue (15.3% per year) is forecast to grow faster than the German market (5.9% per year).

High Growth Revenue: HBO's revenue (15.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: HBO is forecast to be unprofitable in 3 years.


Next Steps

Past Performance

How has DiamondRock Hospitality performed over the past 5 years?

-3.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: HBO has a large one-off gain of $141.8M impacting its March 31 2020 financial results.

Growing Profit Margin: HBO's current net profit margins (15.4%) are higher than last year (10.4%).


Past Earnings Growth Analysis

Earnings Trend: HBO's earnings have declined by -3.2% per year over the past 5 years.

Accelerating Growth: HBO's earnings growth over the past year (51.4%) exceeds its 5-year average (-3.2% per year).

Earnings vs Industry: HBO earnings growth over the past year (51.4%) exceeded the REITs industry 25.3%.


Return on Equity

High ROE: HBO's Return on Equity (7.5%) is considered low.


Next Steps

Financial Health

How is DiamondRock Hospitality's financial position?


Financial Position Analysis

Short Term Liabilities: HBO's short term assets ($526.5M) exceed its short term liabilities ($67.5M).

Long Term Liabilities: HBO's short term assets ($526.5M) do not cover its long term liabilities ($1.7B).


Debt to Equity History and Analysis

Debt Level: HBO's debt to equity ratio (76%) is considered high.

Reducing Debt: HBO's debt to equity ratio has increased from 56.9% to 76% over the past 5 years.

Debt Coverage: HBO's debt is not well covered by operating cash flow (12.7%).

Interest Coverage: HBO's interest payments on its debt are not well covered by EBIT (1.3x coverage).


Balance Sheet


Next Steps

Dividend

What is DiamondRock Hospitality current dividend yield, its reliability and sustainability?

3.55%

Forecast Dividend Yield


Dividend Yield vs Market

Notable Dividend: Unable to evaluate HBO's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate HBO's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if HBO's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if HBO's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: HBO is not paying a notable dividend for the German market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of HBO's dividend in 3 years as they are not forecast to pay a notable one for the German market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

5.6yrs

Average management tenure


CEO

Mark Brugger (50yo)

11.83yrs

Tenure

US$4,855,086

Compensation

Mr. Mark W. Brugger is a Co-Founder of Diamondrock Hospitality Company and has been its Chief Executive Officer and Director since September 1, 2008, and President since May 1, 2013. Mr. Brugger co-founded ...


CEO Compensation Analysis

Compensation vs Market: Mark's total compensation ($USD4.86M) is above average for companies of similar size in the German market ($USD1.43M).

Compensation vs Earnings: Mark's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Mark Brugger
Co-Founder11.83yrsUS$4.86m0.57% $5.3m
Jeffrey Donnelly
Executive VP & CFO0.92yrUS$1.31m0.053% $488.8k
Thomas Healy
Executive VP of Asset Management & COO3.5yrsUS$1.66m0.033% $301.8k
Troy Furbay
Executive VP & Chief Investment Officer6.25yrsUS$1.75m0.015% $141.8k
William Tennis
Executive VP10.5yrsUS$1.41m0.058% $532.7k
Dustin Resnick
Vice President of Acquisitions and Investments5.58yrsno datano data
Briony Quinn
Senior VP & Treasurer2.33yrsno data0.074% $686.2k
Ben Nelson
VP & Corporate Controllerno datano datano data
Sean Kensil
Director of Financial Planning & Analysisno datano datano data

5.6yrs

Average Tenure

51yo

Average Age

Experienced Management: HBO's management team is seasoned and experienced (5.6 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Mark Brugger
Co-Founder11.83yrsUS$4.86m0.57% $5.3m
William Shaw
Independent Director3.75yrsUS$187.50k0.026% $235.9k
Bruce Wardinski
Independent Lead Director4.17yrsUS$212.50k0.039% $356.7k
Gilbert Ray
Independent Director16yrsUS$195.00k0.016% $144.6k
William McCarten
Independent Chairman of the Board16.5yrsUS$278.00k0.18% $1.6m
Maureen McAvey
Independent Director16yrsUS$175.00k0.033% $305.1k
Timothy Chi
Independent Director5.08yrsUS$175.00k0.031% $285.5k
Kathleen Wayton
Independent Director1.42yrsUS$189.65kno data

8.5yrs

Average Tenure

65.5yo

Average Age

Experienced Board: HBO's board of directors are considered experienced (8.5 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

DiamondRock Hospitality Company's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: DiamondRock Hospitality Company
  • Ticker: HBO
  • Exchange: DB
  • Founded: 2004
  • Industry: Hotel and Resort REITs
  • Sector: Real Estate
  • Implied Market Cap: US$1.042b
  • Market Cap: US$917.539m
  • Listing Market Cap: US$921.102m
  • Shares outstanding: 200.02m
  • Website: https://www.drhc.com

Number of Employees


Location

  • DiamondRock Hospitality Company
  • 2 Bethesda Metro Center
  • Suite 1400
  • Bethesda
  • Maryland
  • 20814
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
HBODB (Deutsche Boerse AG)YesCommon SharesDEEURMay 2005
DRHNYSE (New York Stock Exchange)YesCommon SharesUSUSDMay 2005

Biography

DiamondRock Hospitality Company is a self-advised real estate investment trust (REIT) that is an owner of a leading portfolio of geographically diversified hotels concentrated in top gateway markets and destination resort locations. The Company owns 31 premium quality hotels with over 10,000 rooms. The Company has strategically positioned its hotels to be operated both under leading global brand families as well as unique boutique hotels in the lifestyle segment. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/07/13 05:35
End of Day Share Price2020/07/10 00:00
Earnings2020/03/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.