Host Hotels & Resorts (NASDAQ:HST) & Innovative Industrial Properties (NYSE:IIPR) Financial Review

Host Hotels & Resorts (NASDAQ:HST) and Innovative Industrial Properties (NYSE:IIPR) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their analyst recommendations, risk, valuation, earnings, profitability, institutional ownership and dividends.

Risk & Volatility

Host Hotels & Resorts has a beta of 1.11, indicating that its stock price is 11% more volatile than the S&P 500. Comparatively, Innovative Industrial Properties has a beta of 1.45, indicating that its stock price is 45% more volatile than the S&P 500.

Dividends

Host Hotels & Resorts pays an annual dividend of $0.80 per share and has a dividend yield of 4.2%. Innovative Industrial Properties pays an annual dividend of $7.60 per share and has a dividend yield of 15.4%. Host Hotels & Resorts pays out 72.7% of its earnings in the form of a dividend. Innovative Industrial Properties pays out 193.9% 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 has increased its dividend for 2 consecutive years and Innovative Industrial Properties has increased its dividend for 4 consecutive years. Innovative Industrial Properties is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Host Hotels & Resorts and Innovative Industrial Properties’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Host Hotels & Resorts	12.51%	11.54%	5.89%
Innovative Industrial Properties	44.46%	6.43%	5.05%

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Host Hotels & Resorts and Innovative Industrial Properties, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Host Hotels & Resorts	0	6	9	1	2.69
Innovative Industrial Properties	2	2	0	0	1.50

Host Hotels & Resorts currently has a consensus target price of $20.43, indicating a potential upside of 6.23%. Innovative Industrial Properties has a consensus target price of $49.00, indicating a potential downside of 0.82%. Given Host Hotels & Resorts’ stronger consensus rating and higher possible upside, analysts plainly believe Host Hotels & Resorts is more favorable than Innovative Industrial Properties.

Valuation & Earnings

This table compares Host Hotels & Resorts and Innovative Industrial Properties”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Host Hotels & Resorts	$6.11 billion	2.16	$765.00 million	$1.10	17.48
Innovative Industrial Properties	$265.95 million	5.23	$118.25 million	$3.92	12.60

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

Insider and Institutional Ownership

98.5% of Host Hotels & Resorts shares are held by institutional investors. Comparatively, 70.6% of Innovative Industrial Properties shares are held by institutional investors. 1.4% of Host Hotels & Resorts shares are held by company insiders. Comparatively, 2.0% of Innovative Industrial Properties 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.

Summary

Host Hotels & Resorts beats Innovative Industrial Properties on 11 of the 18 factors compared between the two stocks.

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 Innovative Industrial Properties

Innovative Industrial Properties, Inc. is a self-advised Maryland corporation focused on the acquisition, ownership and management of specialized properties leased to experienced, state-licensed operators for their regulated cannabis facilities. Innovative Industrial Properties, Inc. has elected to be taxed as a real estate investment trust, commencing with the year ended December 31, 2017.