Sotherly Hotels (NASDAQ:SOHO) versus Community Healthcare Trust (NYSE:CHCT) Financial Contrast

Community Healthcare Trust (NYSE:CHCT) and Sotherly Hotels (NASDAQ:SOHO) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, risk, earnings, profitability, institutional ownership, valuation and analyst recommendations.

Institutional and Insider Ownership

87.8% of Community Healthcare Trust shares are held by institutional investors. Comparatively, 27.5% of Sotherly Hotels shares are held by institutional investors. 4.0% of Community Healthcare Trust shares are held by insiders. Comparatively, 15.9% of Sotherly Hotels shares are held by 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.

Profitability

This table compares Community Healthcare Trust and Sotherly Hotels’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Community Healthcare Trust	-0.39%	-0.09%	-0.05%
Sotherly Hotels	0.92%	3.48%	0.41%

Valuation & Earnings

This table compares Community Healthcare Trust and Sotherly Hotels”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Community Healthcare Trust	$112.85 million	5.04	$7.71 million	($0.09)	-223.72
Sotherly Hotels	$173.84 million	0.10	$3.94 million	($0.33)	-2.59

Community Healthcare Trust has higher earnings, but lower revenue than Sotherly Hotels. Community Healthcare Trust is trading at a lower price-to-earnings ratio than Sotherly Hotels, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current recommendations and price targets for Community Healthcare Trust and Sotherly Hotels, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Community Healthcare Trust	0	2	1	0	2.33
Sotherly Hotels	0	1	0	0	2.00

Community Healthcare Trust currently has a consensus price target of $21.25, indicating a potential upside of 5.54%. Sotherly Hotels has a consensus price target of $1.50, indicating a potential upside of 75.83%. Given Sotherly Hotels’ higher probable upside, analysts plainly believe Sotherly Hotels is more favorable than Community Healthcare Trust.

Risk and Volatility

Community Healthcare Trust has a beta of 0.68, suggesting that its stock price is 32% less volatile than the S&P 500. Comparatively, Sotherly Hotels has a beta of 1.55, suggesting that its stock price is 55% more volatile than the S&P 500.

Summary

Sotherly Hotels beats Community Healthcare Trust on 7 of the 13 factors compared between the two stocks.

About Community Healthcare Trust

Community Healthcare Trust Incorporated (the Company”, we”, our”) was organized in the State of Maryland on March 28, 2014. The Company is a fully-integrated healthcare real estate company that owns and acquires real estate properties that are leased to hospitals, doctors, healthcare systems or other healthcare service providers. As of March 31, 2024, the Company had investments of approximately $1.1 billion in 197 real estate properties (including a portion of one property accounted for as a sales-type lease with a gross amount totaling approximately $3.0 million and two properties classified as an asset held for sale with an aggregate amount totaling approximately $7.5 million. The properties are located in 35 states, totaling approximately 4.4 million square feet in the aggregate and were approximately 92.3% leased, excluding real estate assets held for sale, at March 31, 2024 with a weighted average remaining lease term of approximately 6.9 years.

About Sotherly Hotels

Sotherly Hotels Inc. is a self-managed and self-administered lodging REIT focused on the acquisition, renovation, upbranding and repositioning of upscale to upper-upscale full-service hotels in the Southern United States. Sotherly may also opportunistically acquire hotels throughout the United States. Currently, the Company's portfolio consists of investments in ten hotel properties, comprising 2,786 rooms, as well as interests in two condominium hotels and their associated rental programs. The Company owns hotels that operate under the Hilton Worldwide and Hyatt Hotels Corporation brands, as well as independent hotels. Sotherly Hotels Inc. was organized in 2004 and is headquartered in Williamsburg, Virginia.