Service Properties Trust (NASDAQ:SVC) versus RLJ Lodging Trust (OTCMKTS:RLJ.PA) Critical Review

RLJ Lodging Trust (OTCMKTS:RLJ.PA) and Service Properties Trust (NASDAQ:SVC) are both real estate companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, institutional ownership, valuation, profitability, earnings, analyst recommendations and dividends.

Institutional and Insider Ownership

77.6% of Service Properties Trust shares are held by institutional investors. 1.6% of Service Properties Trust shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of current ratings and price targets for RLJ Lodging Trust and Service Properties Trust, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
RLJ Lodging Trust	0	0	0	0	0.00
Service Properties Trust	2	1	3	0	2.17

Service Properties Trust has a consensus target price of $12.81, suggesting a potential upside of 55.68%. Given Service Properties Trust’s stronger consensus rating and higher probable upside, analysts clearly believe Service Properties Trust is more favorable than RLJ Lodging Trust.

Valuation & Earnings

This table compares RLJ Lodging Trust and Service Properties Trust”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
RLJ Lodging Trust	N/A	N/A	N/A	N/A	N/A
Service Properties Trust	$1.81 billion	0.59	-$202.32 million	($7.10)	-1.16

RLJ Lodging Trust has higher earnings, but lower revenue than Service Properties Trust.

Profitability

This table compares RLJ Lodging Trust and Service Properties Trust’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
RLJ Lodging Trust	N/A	N/A	N/A
Service Properties Trust	-25.44%	-65.18%	-6.66%

Summary

Service Properties Trust beats RLJ Lodging Trust on 6 of the 9 factors compared between the two stocks.

About RLJ Lodging Trust

RLJ Lodging Trust is a self-advised, publicly traded real estate investment trust that owns primarily premium-branded, high-margin, focused-service and compact full-service hotels. The Company's portfolio consists of 103 hotels with approximately 22,570 rooms, located in 23 states and the District of Columbia and an ownership interest in one unconsolidated hotel with 171 rooms.

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.