Host Hotels & Resorts (NASDAQ:HST) vs. Essex Property Trust (NYSE:ESS) Critical Contrast

Essex Property Trust (NYSE:ESS) and Host Hotels & Resorts (NASDAQ:HST) are both large-cap finance companies, but which is the superior stock? We will compare the two businesses based on the strength of their risk, earnings, profitability, institutional ownership, dividends, analyst recommendations and valuation.

Institutional & Insider Ownership

96.5% of Essex Property Trust shares are owned by institutional investors. Comparatively, 98.5% of Host Hotels & Resorts shares are owned by institutional investors. 3.8% of Essex Property Trust shares are owned by insiders. Comparatively, 1.3% of Host Hotels & Resorts shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Earnings & Valuation

This table compares Essex Property Trust and Host Hotels & Resorts”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Essex Property Trust	$1.67 billion	11.95	$405.83 million	$8.56	36.27
Host Hotels & Resorts	$5.31 billion	2.42	$740.00 million	$1.03	17.88

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

Analyst Recommendations

This is a summary of recent recommendations for Essex Property Trust and Host Hotels & Resorts, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Essex Property Trust	1	12	6	0	2.26
Host Hotels & Resorts	1	3	10	0	2.64

Essex Property Trust currently has a consensus price target of $297.00, suggesting a potential downside of 4.34%. Host Hotels & Resorts has a consensus price target of $21.32, suggesting a potential upside of 15.75%. Given Host Hotels & Resorts’ stronger consensus rating and higher probable upside, analysts plainly believe Host Hotels & Resorts is more favorable than Essex Property Trust.

Risk & Volatility

Essex Property Trust has a beta of 0.88, suggesting that its share price is 12% less volatile than the S&P 500. Comparatively, Host Hotels & Resorts has a beta of 1.32, suggesting that its share price is 32% more volatile than the S&P 500.

Profitability

This table compares Essex Property Trust and Host Hotels & Resorts’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Essex Property Trust	31.55%	9.72%	4.36%
Host Hotels & Resorts	12.92%	10.72%	5.75%

Dividends

Essex Property Trust pays an annual dividend of $9.80 per share and has a dividend yield of 3.2%. Host Hotels & Resorts pays an annual dividend of $0.80 per share and has a dividend yield of 4.3%. Essex Property Trust pays out 114.5% 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 pays out 77.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Essex Property Trust has raised its dividend for 30 consecutive years. Host Hotels & Resorts is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Host Hotels & Resorts beats Essex Property Trust on 11 of the 17 factors compared between the two stocks.

About Essex Property Trust

Essex Property Trust, Inc., an S&P 500 company, is a fully integrated real estate investment trust (REIT) that acquires, develops, redevelops, and manages multifamily residential properties in selected West Coast markets. Essex currently has ownership interests in 252 apartment communities comprising approximately 62,000 apartment homes with an additional property in active development.

About Host Hotels & Resorts

Host Hotels & Resorts, Inc. is an S&P 500 company and is the largest lodging real estate investment trust and one of the largest owners of luxury and upper-upscale hotels. The Company currently owns 72 properties in the United States and five properties internationally totaling approximately 42,000 rooms. The Company also holds non-controlling interests in seven domestic and one international joint ventures. Guided by a disciplined approach to capital allocation and aggressive asset management, the Company partners with premium brands such as Marriott, Ritz-Carlton, Westin, Sheraton, W, St. Regis, The Luxury Collection, Hyatt, Fairmont, Hilton, Four Seasons, Swissôtel, ibis and Novotel, as well as independent brands.