Contrasting CareTrust REIT (NYSE:CTRE) and Apple Hospitality REIT (NYSE:APLE)

Apple Hospitality REIT (NYSE:APLE) and CareTrust REIT (NYSE:CTRE) are both mid-cap finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their dividends, profitability, institutional ownership, earnings, valuation, risk and analyst recommendations.

Earnings & Valuation

This table compares Apple Hospitality REIT and CareTrust REIT”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Apple Hospitality REIT	$1.43 billion	1.99	$214.06 million	$0.73	16.50
CareTrust REIT	$296.29 million	27.30	$125.08 million	$1.34	27.03

Apple Hospitality REIT has higher revenue and earnings than CareTrust REIT. Apple Hospitality REIT is trading at a lower price-to-earnings ratio than CareTrust REIT, indicating that it is currently the more affordable of the two stocks.

Dividends

Apple Hospitality REIT pays an annual dividend of $0.96 per share and has a dividend yield of 8.0%. CareTrust REIT pays an annual dividend of $1.34 per share and has a dividend yield of 3.7%. Apple Hospitality REIT pays out 131.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. CareTrust REIT pays out 100.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Profitability

This table compares Apple Hospitality REIT and CareTrust REIT’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Apple Hospitality REIT	12.37%	5.46%	3.55%
CareTrust REIT	61.00%	7.95%	6.13%

Insider & Institutional Ownership

89.7% of Apple Hospitality REIT shares are held by institutional investors. Comparatively, 87.8% of CareTrust REIT shares are held by institutional investors. 7.1% of Apple Hospitality REIT shares are held by company insiders. Comparatively, 0.5% of CareTrust REIT 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.

Risk & Volatility

Apple Hospitality REIT has a beta of 0.85, indicating that its stock price is 15% less volatile than the S&P 500. Comparatively, CareTrust REIT has a beta of 0.75, indicating that its stock price is 25% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings for Apple Hospitality REIT and CareTrust REIT, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Apple Hospitality REIT	0	4	2	0	2.33
CareTrust REIT	0	1	0	2	3.33

Apple Hospitality REIT presently has a consensus price target of $12.70, indicating a potential upside of 5.44%. Given Apple Hospitality REIT’s higher probable upside, research analysts clearly believe Apple Hospitality REIT is more favorable than CareTrust REIT.

Summary

CareTrust REIT beats Apple Hospitality REIT on 9 of the 17 factors compared between the two stocks.

About Apple Hospitality REIT

Apple Hospitality REIT, Inc. (NYSE: APLE) is a publicly traded real estate investment trust (REIT) that owns one of the largest and most diverse portfolios of upscale, rooms-focused hotels in the United States. Apple Hospitality's portfolio consists of 223 hotels with more than 29,400 guest rooms located in 87 markets throughout 37 states as well as one property leased to third parties. Concentrated with industry-leading brands, the Company's hotel portfolio consists of 99 Marriott-branded hotels, 119 Hilton-branded hotels and five Hyatt-branded hotels.

About CareTrust REIT

CareTrust REIT, Inc. is a self-administered, publicly-traded real estate investment trust engaged in the ownership, acquisition, development and leasing of skilled nursing, seniors housing and other healthcare-related properties. With a nationwide portfolio of long-term net-leased properties, and a growing portfolio of quality operators leasing them, CareTrust REIT is pursuing both external and organic growth opportunities across the United States.