Contrasting Lamar Advertising (NASDAQ:LAMR) and Host Hotels & Resorts (NASDAQ:HST)

Host Hotels & Resorts (NASDAQ:HST) and Lamar Advertising (NASDAQ:LAMR) are both finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their earnings, profitability, risk, analyst recommendations, valuation, institutional ownership and dividends.

Profitability

This table compares Host Hotels & Resorts and Lamar Advertising’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Host Hotels & Resorts	12.26%	10.37%	5.47%
Lamar Advertising	16.40%	30.20%	5.53%

Institutional & Insider Ownership

98.5% of Host Hotels & Resorts shares are held by institutional investors. Comparatively, 93.8% of Lamar Advertising shares are held by institutional investors. 1.3% of Host Hotels & Resorts shares are held by company insiders. Comparatively, 15.0% of Lamar Advertising shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Volatility and Risk

Host Hotels & Resorts has a beta of 1.26, meaning that its share price is 26% more volatile than the S&P 500. Comparatively, Lamar Advertising has a beta of 1.34, meaning that its share price is 34% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings for Host Hotels & Resorts and Lamar Advertising, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Host Hotels & Resorts	1	5	8	0	2.50
Lamar Advertising	0	4	1	0	2.20

Host Hotels & Resorts presently has a consensus price target of $19.54, indicating a potential upside of 51.21%. Lamar Advertising has a consensus price target of $134.60, indicating a potential upside of 28.34%. Given Host Hotels & Resorts’ stronger consensus rating and higher possible upside, analysts clearly believe Host Hotels & Resorts is more favorable than Lamar Advertising.

Valuation and Earnings

This table compares Host Hotels & Resorts and Lamar Advertising”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Host Hotels & Resorts	$5.68 billion	1.59	$740.00 million	$0.99	13.05
Lamar Advertising	$2.21 billion	4.87	$495.76 million	$3.53	29.71

Host Hotels & Resorts has higher revenue and earnings than Lamar Advertising. Host Hotels & Resorts is trading at a lower price-to-earnings ratio than Lamar Advertising, indicating that it is currently the more affordable of the two stocks.

Dividends

Host Hotels & Resorts pays an annual dividend of $0.80 per share and has a dividend yield of 6.2%. Lamar Advertising pays an annual dividend of $6.20 per share and has a dividend yield of 5.9%. Host Hotels & Resorts pays out 80.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Lamar Advertising pays out 175.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Host Hotels & Resorts is clearly the better dividend stock, given its higher yield and lower payout ratio.

About Host Hotels & Resorts

Host Hotels & Resorts, Inc. is a real estate investment trust, which engages in the management of luxury and upper-upscale hotels. It operates through the following geographical segments: United States, Brazil, and Canada. The company was founded in 1927 and is headquartered in Bethesda, MD.

About Lamar Advertising

Lamar Advertising Company operates as an outdoor advertising company in the United States and Canada. The company owns and operates billboards, logo signs, and transit advertising displays, as well as rents space for advertising on billboards, buses, shelters, benches, logo plates, and in airport terminals. Lamar Advertising Company was founded in 1902 and is headquartered in Baton Rouge, Louisiana.