Sunstone Hotel InvestorsNYSE: SHO

Sunstone manages a high-quality hotel portfolio located in coastal markets. It has good growth prospects and very low leverage, but also a low dividend yield. The valuation is not very attractive, which presents a significant risk for investors.

The Sunstone Hotel Investors, Inc. preferred share price of the Series H has come down from a Q1 spike. Sunstone Hotel Investors reported a net income of $13M in Q1, with a decrease in AFFO per share compared to previous years. Sunstone's redevelopment plan and capital expenditures may cause short-term pain but are expected to result in long-term gains. The anticipated preferred dividend payout ratio is just under 8%.

The latest figures for Sunstone Hotel (SHO) provide a glimpse into the company's performance in the first quarter of 2024, but it could be beneficial to analyze certain important metrics against Wall Street projections and last year's results.

Sunstone Hotel Investors (SHO) reported quarterly funds from operations (FFO) of $0.18 per share, surpassing the Zacks Consensus Estimate of $0.16 per share. This is lower than the FFO of $0.21 per share from the same quarter last year.

The intense selling pressure on Sunstone Hotel (SHO) may have eased as it is currently in oversold territory. Along with this technical indicator, the consensus among Wall Street analysts in raising earnings forecasts suggests that the stock is primed for a turnaround.

Investors looking at stocks in the REIT and Equity Trust - Other sector are likely familiar with Sunstone Hotel Investors (SHO) and Stag Industrial (STAG). However, which of these two stocks provides better value for value investors at the moment?

Sunstone Hotel Investors' preferred dividends are well covered and offer a reliable stream of quarterly dividends. The FFO and AFFO performance of Sunstone indicate the stock is currently relatively attractively priced while the preferred stock is very attractive. The H-series preferred shares have a higher yield and are more likely to be called, making them a better investment option at this point in time.

Although the revenue and EPS for Sunstone Hotel (SHO) give a sense of how its business performed in the quarter ended December 2023, it might be worth considering how some key metrics compare with Wall Street estimates and the year-ago numbers.

Sunstone Hotel Investors (SHO) came out with quarterly funds from operations (FFO) of $0.19 per share, beating the Zacks Consensus Estimate of $0.16 per share. This compares to FFO of $0.26 per share a year ago.