Medalist Diversified REIT (NASDAQ:MDRR – Get Free Report) and Service Properties Trust (NASDAQ:SVC – Get Free Report) are both small-cap finance companies, but which is the superior stock? We will compare the two companies based on the strength of their analyst recommendations, profitability, earnings, valuation, dividends, institutional ownership and risk.
Dividends
Medalist Diversified REIT pays an annual dividend of $0.27 per share and has a dividend yield of 2.4%. Service Properties Trust pays an annual dividend of $0.04 per share and has a dividend yield of 2.6%. Medalist Diversified REIT pays out -14.7% of its earnings in the form of a dividend. Service Properties Trust pays out -3.3% 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. Medalist Diversified REIT has increased its dividend for 2 consecutive years.
Volatility & Risk
Medalist Diversified REIT has a beta of 0.51, meaning that its stock price is 49% less volatile than the S&P 500. Comparatively, Service Properties Trust has a beta of 1.6, meaning that its stock price is 60% more volatile than the S&P 500.
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Medalist Diversified REIT | 1 | 0 | 0 | 0 | 1.00 |
| Service Properties Trust | 1 | 2 | 1 | 0 | 2.00 |
Service Properties Trust has a consensus price target of $2.00, suggesting a potential upside of 29.87%. Given Service Properties Trust’s stronger consensus rating and higher possible upside, analysts plainly believe Service Properties Trust is more favorable than Medalist Diversified REIT.
Insider & Institutional Ownership
17.4% of Medalist Diversified REIT shares are held by institutional investors. Comparatively, 77.6% of Service Properties Trust shares are held by institutional investors. 43.8% of Medalist Diversified REIT shares are held by company insiders. Comparatively, 1.6% of Service Properties Trust shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Profitability
This table compares Medalist Diversified REIT and Service Properties Trust’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Medalist Diversified REIT | -22.37% | -9.28% | -2.86% |
| Service Properties Trust | -11.15% | -29.70% | -2.96% |
Valuation & Earnings
This table compares Medalist Diversified REIT and Service Properties Trust”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Medalist Diversified REIT | $10.40 million | 1.54 | -$2.39 million | ($1.84) | -6.09 |
| Service Properties Trust | $1.81 billion | 0.14 | -$202.32 million | ($1.21) | -1.27 |
Medalist Diversified REIT has higher earnings, but lower revenue than Service Properties Trust. Medalist Diversified REIT is trading at a lower price-to-earnings ratio than Service Properties Trust, indicating that it is currently the more affordable of the two stocks.
Summary
Service Properties Trust beats Medalist Diversified REIT on 10 of the 17 factors compared between the two stocks.
About Medalist Diversified REIT
Medalist Diversified REIT Inc. is a Virginia-based real estate investment trust that specializes in acquiring, owning and managing commercial real estate in the Southeast region of the U.S. The Company's strategy is to focus on commercial real estate which is expected to provide an attractive balance of risk and returns. Medalist utilizes a rigorous, consistent and replicable process for sourcing and conducting due diligence of acquisitions.
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.
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