Home Dividends High Dividend Yield Present Valuation: Diamondrock Hospitality Company (NYSE: DRH)

Present Valuation: Diamondrock Hospitality Company (NYSE: DRH)


Diamondrock Hospitality Company trades as part of the REITs industry and trades as part of the real estate sector. The company CEO is Mark W. Brugger. Diamondrock Hospitality Co functions in the real estate sector. As a real estate investment trust, the company primarily focuses on a portfolio of lodging facilities such as hotels and resorts.

Previous Intraday Trading Performance:

The DRH stock showed a previous change of 4.13% with an open at 10.20 and a close of 10.58. It reached an intraday high of 10.59 and a low of 10.20.

SeekingAlpha:  DiamondRock Hospitality Company 2018 Q3 – Results – Earnings Call Slides


The stock has a market cap of $2.2b with 207.8m shares outstanding, of which the float is 203.3m shares. Trading volume reached 2,067,702 shares compared to its average volume of 2,615,900 shares. Based on the current average volume and close price, the trading liquidity is good.

Historical Trading Performance:

Over the last five trading days, Diamondrock Hospitality Company shares returned 2.03% and in the past 30 trading days it returned -8.95%. Over three months, it changed -9.37%. In one year it has changed -1.77% and within that year its 52-week high was 12.99 and its 52-week low was 9.87. DRH stock is 7.19% above its 52 Week Low.

Our calculations show a 200 day moving average of 11.25 and a 50 day moving average of 11.13. Currently DRH stock is trading -5.92% below its 200 day moving average and may not be a good opportunity to buy as it may continue to trend down.

SeekingAlpha:  DiamondRock Hospitality Company 2018 Q3 – Results – Earnings Call Slides


The last annual fiscal EPS for the company was reported at 0.46 that ended on 31st of December 2017, which according to the previous close, that is a PE of 23.00. Based on 7 analyst estimates, the consensus EPS for the next quarter is 0.26. The TTM EPS is 1.01, which comes to a TTM PE of 10.48.

The following are the last four quarter reported earnings per share:
09-30-2018:  0.27
06-30-2018:  0.32
03-31-2018:  0.17
12-31-2017:  0.25

The dividend per share is currently 0.50, which is a dividend yield of 4.73%. Also, the payout ratio is 49.50%, therefore the dividend is safe according to our calculations. DRH stock has a high dividend yield, but because the company has sufficient earnings to cover future dividends, it may be a good investment opportunity for an income portfolio.

Base on our calculations, the intrinsic value per share is 14.07, which means it is possibly undervalued and has a margin of safety of 24.78%

Indicators to Watch:

Based on the latest filings, there is 83.00% of institutional ownership. Short-interest is 13,080,153, which is 6.29% of shares outstanding. The short-interest ratio or days-to-cover ratio is 5.70. This stock has a moderate level of short interest, but may still be a buying opportunity depending on other indicators.

The current calculated beta is 1.37

SeekingAlpha:  Depomed beats by $0.03, misses on revenue

Fundamental Indicators:

Based on last reported financials, the company’s return on equity is 4.16%, return on assets is 2.49%, profit margin is 9.60%, price-to-sales is 3.57 and price-to-book is 1.10.

Company Scores:

All scores are out of six:
 3  :Valuation Score
 1  :Past Performance Score
 4  :Financial Strength Score
 0  :Future Growth Score
 5  :Dividend Score
 2  :Overall Score

John Jones
Worked for several Wall Street firms: Salomon Smith Barney, UBS, and Charles Schwab. Has developed skills and gained extensive experience over the years that is used today to uncover winning penny stocks.Also was an attorney for small businesses in Scottsdale, Arizona. That experience and understanding of law provides a unique perspective and edge in discovering quality companies in various industries.