Apple Hospitality REIT (APLE) and Extra Space Storage (EXR) Head to Head Comparison

Apple Hospitality REIT (NYSE: APLE) and Extra Space Storage (NYSE:EXR) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, profitability, risk, earnings and valuation.

Dividends

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Apple Hospitality REIT pays an annual dividend of $1.20 per share and has a dividend yield of 6.9%. Extra Space Storage pays an annual dividend of $3.12 per share and has a dividend yield of 3.6%. Apple Hospitality REIT pays out 69.0% of its earnings in the form of a dividend. Extra Space Storage pays out 71.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Extra Space Storage has increased its dividend for 7 consecutive years. Apple Hospitality REIT is clearly the better dividend stock, given its higher yield and lower payout ratio.

Valuation and Earnings

This table compares Apple Hospitality REIT and Extra Space Storage’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Apple Hospitality REIT $1.24 billion 3.25 $182.49 million $1.74 10.06
Extra Space Storage $1.11 billion 9.90 $479.01 million $4.38 19.82

Extra Space Storage has lower revenue, but higher earnings than Apple Hospitality REIT. Apple Hospitality REIT is trading at a lower price-to-earnings ratio than Extra Space Storage, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

54.5% of Apple Hospitality REIT shares are owned by institutional investors. 6.3% of Apple Hospitality REIT shares are owned by company insiders. Comparatively, 3.7% of Extra Space Storage shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Apple Hospitality REIT and Extra Space Storage, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Apple Hospitality REIT 0 5 1 0 2.17
Extra Space Storage 0 9 2 1 2.33

Apple Hospitality REIT currently has a consensus target price of $19.75, indicating a potential upside of 12.79%. Extra Space Storage has a consensus target price of $86.00, indicating a potential downside of 0.94%. Given Apple Hospitality REIT’s higher possible upside, equities analysts plainly believe Apple Hospitality REIT is more favorable than Extra Space Storage.

Risk and Volatility

Apple Hospitality REIT has a beta of 0.65, meaning that its stock price is 35% less volatile than the S&P 500. Comparatively, Extra Space Storage has a beta of 0.21, meaning that its stock price is 79% less volatile than the S&P 500.

Profitability

This table compares Apple Hospitality REIT and Extra Space Storage’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Apple Hospitality REIT 14.73% 5.19% 3.71%
Extra Space Storage 44.67% 18.87% 6.90%

Summary

Extra Space Storage beats Apple Hospitality REIT on 11 of the 18 factors compared between the two stocks.

Apple Hospitality REIT Company Profile

Apple Hospitality REIT, Inc. (NYSE: APLE) is a publicly traded real estate investment trust (REIT) that owns one of the largest portfolios of upscale, select-service hotels in the United States. The Company's highly diversified portfolio consists of 241 hotels with more than 30,500 guest rooms located in 88 markets throughout 34 states. The Company's hotels are franchised with industry leading brands, and the Company's portfolio includes 117 Marriott<sup>®</sup>branded hotels and 124 Hilton<sup>®</sup> branded hotels. For more information, please visit www.applehospitalityreit.com.

Extra Space Storage Company Profile

Extra Space Storage Inc. is a self-administered and self-managed real estate investment trust (REIT). The Company owns, operates, manages, acquires, develops and redevelops self-storage properties located throughout the United States. The Company operates through three segments: rental operations; tenant reinsurance, and property management, acquisition and development. The Company’s rental operations activities include rental operations of stores in which it has an ownership interest. The Tenant reinsurance activities include the reinsurance of risks relating to the loss of goods stored by tenants in its stores. The Company’s property management, acquisition and development activities include managing, acquiring, developing and selling stores. The Company’s interest in its stores is held through its operating partnership, Extra Space Storage LP (the Operating Partnership). Its primary assets are general partner and limited partner interests in the Operating Partnership.

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