DiamondRock Hospitality Company
DiamondRock Hospitality Company Fundamental Analysis
DiamondRock Hospitality Company (DRH-PA) shows weak financial fundamentals with a PE ratio of 31.90, profit margin of 5.69%, and ROE of 4.06%. The company generates $1.1B in annual revenue with moderate year-over-year growth of 5.12%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 31.7/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze DRH-PA's fundamental strength across five key dimensions:
Efficiency Score
WeakDRH-PA struggles to generate sufficient returns from assets.
Valuation Score
ModerateDRH-PA shows balanced valuation metrics.
Growth Score
ModerateDRH-PA shows steady but slowing expansion.
Financial Health Score
ModerateDRH-PA shows balanced financial health with some risks.
Profitability Score
WeakDRH-PA struggles to sustain strong margins.
Key Financial Metrics
Is DRH-PA Expensive or Cheap?
P/E Ratio
DRH-PA trades at 31.90 times earnings. This suggests a premium valuation.
PEG Ratio
When adjusting for growth, DRH-PA's PEG of -8.93 indicates potential undervaluation.
Price to Book
The market values DiamondRock Hospitality Company at 1.30 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 4.10 times EBITDA. This is generally considered low.
How Well Does DRH-PA Make Money?
Net Profit Margin
For every $100 in sales, DiamondRock Hospitality Company keeps $5.69 as profit after all expenses.
Operating Margin
Core operations generate 14.30 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $4.06 in profit for every $100 of shareholder equity.
ROA
DiamondRock Hospitality Company generates $2.03 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
DiamondRock Hospitality Company produces operating cash flow of $249.60M, showing steady but balanced cash generation.
Free Cash Flow
DiamondRock Hospitality Company generates strong free cash flow of $135.82M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $0.67 in free cash annually.
FCF Yield
DRH-PA converts 6.72% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
31.90
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-8.93
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.30
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.80
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.76
vs 25 benchmark
Current Ratio
Current assets to current liabilities
0.96
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.04
vs 25 benchmark
ROA
Return on assets percentage
0.02
vs 25 benchmark
ROCE
Return on capital employed
0.06
vs 25 benchmark
How DRH-PA Stacks Against Its Sector Peers
| Metric | DRH-PA Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 31.90 | 24.23 | Worse (Expensive) |
| ROE | 4.06% | 659.00% | Weak |
| Net Margin | 5.69% | 4497.00% | Weak |
| Debt/Equity | 0.76 | -22.14 (disorted) | Distorted |
| Current Ratio | 0.96 | 13.87 | Weak Liquidity |
| ROA | 2.03% | -1390.00% (disorted) | Weak |
DRH-PA outperforms its industry in 0 out of 6 key metrics, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews DiamondRock Hospitality Company's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
15.70%
Industry Style: Income, Inflation Hedge, REIT
High GrowthEPS CAGR
-74.85%
Industry Style: Income, Inflation Hedge, REIT
DecliningFCF CAGR
11.53%
Industry Style: Income, Inflation Hedge, REIT
High Growth