Critical Comparison: Service Properties Trust (NASDAQ:SVC) and BRAEMAR HOTELS & RESORTS (NYSE:BHR)

Service Properties Trust (NASDAQ:SVC) and BRAEMAR HOTELS & RESORTS (NYSE:BHR) are both small-cap real estate companies, but which is the superior business? We will contrast the two businesses based on the strength of their dividends, earnings, analyst recommendations, institutional ownership, risk, profitability and valuation.

Volatility & Risk

Service Properties Trust has a beta of 1.66, meaning that its share price is 66% more volatile than the S&P 500. Comparatively, BRAEMAR HOTELS & RESORTS has a beta of 0.79, meaning that its share price is 21% less volatile than the S&P 500.

Institutional & Insider Ownership

77.6% of Service Properties Trust shares are owned by institutional investors. Comparatively, 64.8% of BRAEMAR HOTELS & RESORTS shares are owned by institutional investors. 1.6% of Service Properties Trust shares are owned by insiders. Comparatively, 8.2% of BRAEMAR HOTELS & RESORTS shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent ratings and price targets for Service Properties Trust and BRAEMAR HOTELS & RESORTS, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Service Properties Trust	1	2	3	0	2.33
BRAEMAR HOTELS & RESORTS	1	2	0	0	1.67

Service Properties Trust presently has a consensus price target of $12.81, indicating a potential upside of 92.38%. BRAEMAR HOTELS & RESORTS has a consensus price target of $2.50, indicating a potential upside of 39.28%. Given Service Properties Trust’s stronger consensus rating and higher possible upside, equities analysts plainly believe Service Properties Trust is more favorable than BRAEMAR HOTELS & RESORTS.

Valuation & Earnings

This table compares Service Properties Trust and BRAEMAR HOTELS & RESORTS”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Service Properties Trust	$1.81 billion	0.48	-$202.32 million	($7.70)	-0.86
BRAEMAR HOTELS & RESORTS	$704.02 million	0.18	-$22.32 million	($0.73)	-2.46

BRAEMAR HOTELS & RESORTS has lower revenue, but higher earnings than Service Properties Trust. BRAEMAR HOTELS & RESORTS is trading at a lower price-to-earnings ratio than Service Properties Trust, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Service Properties Trust and BRAEMAR HOTELS & RESORTS’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Service Properties Trust	-25.44%	-65.18%	-6.66%
BRAEMAR HOTELS & RESORTS	-0.45%	-1.92%	-0.17%

Summary

Service Properties Trust beats BRAEMAR HOTELS & RESORTS on 8 of the 14 factors compared between the two stocks.

About Service Properties Trust

Service Properties Trust (Nasdaq: SVC) is a real estate investment trust with over $11 billion invested in two asset categories: hotels and service-focused retail net lease properties. As of December 31, 2023, SVC owned 221 hotels with over 37,000 guest rooms throughout the United States and in Puerto Rico and Canada, the majority of which are extended stay and select service. As of December 31, 2023, SVC also owned 752 service-focused retail net lease properties totaling approximately 13.3 million square feet throughout the United States. SVC is managed by The RMR Group (Nasdaq: RMR), a leading U.S. alternative asset management company with over $41 billion in assets under management as of December 31, 2023, and more than 35 years of institutional experience in buying, selling, financing and operating commercial real estate. SVC is headquartered in Newton, MA.

About BRAEMAR HOTELS & RESORTS

Braemar Hotels & Resorts is a conservatively capitalized REIT that invests primarily in high RevPAR, full-service luxury hotels and resorts. We are listed on the New York Stock Exchange under the symbol BHR and are externally-advised by Ashford (NYSE American: AINC).