Reviewing W.P. Carey (NYSE:WPC) & Summit Hotel Properties (NYSE:INN)

W.P. Carey (NYSE:WPC) and Summit Hotel Properties (NYSE:INN) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, earnings, profitability, institutional ownership, risk, valuation and analyst recommendations.

Valuation and Earnings

This table compares W.P. Carey and Summit Hotel Properties”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
W.P. Carey	$1.64 billion	8.80	$460.84 million	$1.52	43.46
Summit Hotel Properties	$727.13 million	0.80	$41.02 million	($0.09)	-59.28

W.P. Carey has higher revenue and earnings than Summit Hotel Properties. Summit Hotel Properties is trading at a lower price-to-earnings ratio than W.P. Carey, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares W.P. Carey and Summit Hotel Properties’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
W.P. Carey	20.42%	4.00%	1.91%
Summit Hotel Properties	1.00%	0.56%	0.25%

Dividends

W.P. Carey pays an annual dividend of $3.60 per share and has a dividend yield of 5.5%. Summit Hotel Properties pays an annual dividend of $0.32 per share and has a dividend yield of 6.0%. W.P. Carey pays out 236.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Summit Hotel Properties pays out -355.6% of its earnings in the form of a dividend. W.P. Carey has raised its dividend for 2 consecutive years and Summit Hotel Properties has raised its dividend for 2 consecutive years. Summit Hotel Properties is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider & Institutional Ownership

73.7% of W.P. Carey shares are held by institutional investors. Comparatively, 96.5% of Summit Hotel Properties shares are held by institutional investors. 0.9% of W.P. Carey shares are held by insiders. Comparatively, 3.4% of Summit Hotel Properties shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for W.P. Carey and Summit Hotel Properties, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
W.P. Carey	1	7	2	0	2.10
Summit Hotel Properties	0	1	0	0	2.00

W.P. Carey presently has a consensus target price of $65.67, indicating a potential downside of 0.59%. Summit Hotel Properties has a consensus target price of $5.75, indicating a potential upside of 7.78%. Given Summit Hotel Properties’ higher probable upside, analysts clearly believe Summit Hotel Properties is more favorable than W.P. Carey.

Risk & Volatility

W.P. Carey has a beta of 0.78, meaning that its stock price is 22% less volatile than the S&P 500. Comparatively, Summit Hotel Properties has a beta of 1.73, meaning that its stock price is 73% more volatile than the S&P 500.

Summary

W.P. Carey beats Summit Hotel Properties on 10 of the 16 factors compared between the two stocks.

About W.P. Carey

W. P. Carey ranks among the largest net lease REITs with a well-diversified portfolio of high-quality, operationally critical commercial real estate, which includes 1,424 net lease properties covering approximately 173 million square feet and a portfolio of 89 self-storage operating properties as of December 31, 2023. With offices in New York, London, Amsterdam and Dallas, the company remains focused on investing primarily in single-tenant, industrial, warehouse and retail properties located in the U.S. and Northern and Western Europe, under long-term net leases with built-in rent escalations.

About Summit Hotel Properties

Summit Hotel Properties, Inc. is a publicly traded real estate investment trust focused on owning premium-branded lodging properties with efficient operating models primarily in the upscale segment of the lodging industry. As of November 1, 2023, the Company’s portfolio consisted of 101 assets, 57 of which are wholly owned, with a total of 15,035 guestrooms located in 24 states.