Summit Hotel Properties (NYSE:INN) and Great Ajax (NYSE:AJX) Financial Contrast

Summit Hotel Properties (NYSE:INN) and Great Ajax (NYSE:AJX) are both small-cap finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, valuation, earnings, risk, profitability and dividends.

Earnings & Valuation

This table compares Summit Hotel Properties and Great Ajax”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Summit Hotel Properties	$736.29 million	0.96	-$12.11 million	$0.01	653.00
Great Ajax	$72.33 million	1.93	-$47.07 million	($3.77)	-0.81

Summit Hotel Properties has higher revenue and earnings than Great Ajax. Great Ajax is trading at a lower price-to-earnings ratio than Summit Hotel Properties, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current recommendations for Summit Hotel Properties and Great Ajax, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Summit Hotel Properties	0	1	0	0	2.00
Great Ajax	0	2	1	0	2.33

Great Ajax has a consensus price target of $6.00, indicating a potential upside of 95.44%. Given Great Ajax’s stronger consensus rating and higher possible upside, analysts plainly believe Great Ajax is more favorable than Summit Hotel Properties.

Profitability

This table compares Summit Hotel Properties and Great Ajax’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Summit Hotel Properties	3.41%	1.87%	0.86%
Great Ajax	-203.61%	-8.35%	-1.99%

Risk and Volatility

Summit Hotel Properties has a beta of 2.05, suggesting that its stock price is 105% more volatile than the S&P 500. Comparatively, Great Ajax has a beta of 1.9, suggesting that its stock price is 90% more volatile than the S&P 500.

Institutional and Insider Ownership

96.5% of Summit Hotel Properties shares are held by institutional investors. Comparatively, 58.6% of Great Ajax shares are held by institutional investors. 3.4% of Summit Hotel Properties shares are held by company insiders. Comparatively, 2.3% of Great Ajax shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Dividends

Summit Hotel Properties pays an annual dividend of $0.32 per share and has a dividend yield of 4.9%. Great Ajax pays an annual dividend of $0.24 per share and has a dividend yield of 7.8%. Summit Hotel Properties pays out 3,200.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Great Ajax pays out -6.4% of its earnings in the form of a dividend. Great Ajax is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Summit Hotel Properties beats Great Ajax on 10 of the 16 factors compared between the two stocks.

About Summit Hotel Properties

Summit Hotel Properties, Inc. is a publicly traded real estate investment trust focused on owning premium-branded lodging properties with efficient operating models primarily in the upscale segment of the lodging industry. As of November 1, 2023, the Company’s portfolio consisted of 101 assets, 57 of which are wholly owned, with a total of 15,035 guestrooms located in 24 states.

About Great Ajax

Great Ajax Corp. operates as a mortgage real estate investment trust. It acquires re-performing and non-performing loans; acquires or originates small balance commercial mortgage loans that are secured by multi-family residential and commercial mixed use retail/residential properties; and invests in single-family and smaller commercial properties. The company elected to be taxed as a real estate investment trust for U.S. federal income tax purposes. Great Ajax Corp. was incorporated in 2014 and is based in Tigard, Oregon.