DiamondRock Hospitality (NYSE:DRH) Hits New 12-Month High on Analyst Upgrade

Key Points

• DiamondRock Hospitality hit a new 52-week high after Wells Fargo raised its price target from $13 to $14, though it maintained an Equal Weight rating. Shares reached $14.10, versus a prior close of $13.76.
• Analyst sentiment remains mixed: four analysts rate the stock a Buy and seven rate it a Hold, producing a consensus Hold rating and an average price target of $13.03.
• The REIT reported quarterly adjusted earnings of $0.44 per share, beating estimates of $0.22, and increased its quarterly dividend from $0.09 to $0.11, implying a 3.1% annualized yield.

DiamondRock Hospitality Company (NYSE:DRH - Get Free Report)'s stock price reached a new 52-week high on Monday after Wells Fargo & Company raised their price target on the stock from $13.00 to $14.00. Wells Fargo & Company currently has an equal weight rating on the stock. DiamondRock Hospitality traded as high as $14.10 and last traded at $14.0050, with a volume of 162,641 shares. The stock had previously closed at $13.76.

Several other research analysts have also recently weighed in on the stock. Barclays increased their price target on shares of DiamondRock Hospitality from $12.00 to $14.00 and gave the company an "equal weight" rating in a report on Thursday, August 27th. Morgan Stanley upped their price objective on DiamondRock Hospitality from $11.00 to $12.00 and gave the company an "equal weight" rating in a report on Monday, October 12th. Zacks Research downgraded DiamondRock Hospitality from a "strong-buy" rating to a "hold" rating in a report on Monday, September 28th. Bank of America lifted their target price on DiamondRock Hospitality from $12.50 to $13.00 and gave the stock a "buy" rating in a report on Monday, July 20th. Finally, Citigroup upped their price target on shares of DiamondRock Hospitality from $11.00 to $13.00 and gave the company a "neutral" rating in a research note on Wednesday, July 22nd. Four investment analysts have rated the stock with a Buy rating and seven have issued a Hold rating to the stock. According to MarketBeat, the stock has a consensus rating of "Hold" and an average target price of $13.03.

Institutional Investors Weigh In On DiamondRock Hospitality

Large investors have recently added to or reduced their stakes in the stock. BlackRock Inc. bought a new position in shares of DiamondRock Hospitality in the second quarter worth about $475,282,000. Bank of America Corp DE bought a new stake in shares of DiamondRock Hospitality during the 2nd quarter valued at approximately $129,710,000. Pzena Investment Management LLC bought a new stake in shares of DiamondRock Hospitality during the 2nd quarter valued at approximately $34,464,000. Bank of New York Mellon Corp bought a new stake in shares of DiamondRock Hospitality during the 2nd quarter valued at approximately $19,809,000. Finally, Deutsche Bank AG acquired a new position in DiamondRock Hospitality during the 2nd quarter worth approximately $19,036,000.

DiamondRock Hospitality Stock Performance

The firm has a market capitalization of $2.87 billion, a price-to-earnings ratio of 56.10, a PEG ratio of 4.50 and a beta of 1.01. The company has a current ratio of 1.64, a quick ratio of 1.64 and a debt-to-equity ratio of 0.70. The stock's 50-day moving average is $12.61 and its 200-day moving average is $11.91.

DiamondRock Hospitality (NYSE:DRH - Get Free Report) last issued its earnings results on Thursday, July 30th. The real estate investment trust reported $0.44 earnings per share for the quarter, beating analysts' consensus estimates of $0.22 by $0.22. The firm had revenue of $318.29 million for the quarter, compared to analyst estimates of $314.98 million. DiamondRock Hospitality had a net margin of 5.69% and a return on equity of 4.04%. The company's quarterly revenue was up 4.1% on a year-over-year basis. During the same quarter last year, the business posted $0.35 earnings per share. DiamondRock Hospitality has set its FY 2026 guidance at 1.180-1.230 EPS. On average, analysts predict that DiamondRock Hospitality Company will post 0.96 EPS for the current fiscal year.

DiamondRock Hospitality Increases Dividend

The business also recently disclosed a quarterly dividend, which was paid on Wednesday, October 14th. Investors of record on Wednesday, September 30th were issued a $0.11 dividend. The ex-dividend date was Wednesday, September 30th. This is a positive change from DiamondRock Hospitality's previous quarterly dividend of $0.09. This represents a $0.44 dividend on an annualized basis and a yield of 3.1%. DiamondRock Hospitality's dividend payout ratio (DPR) is currently 60.27%.

DiamondRock Hospitality Company Profile

DiamondRock Hospitality Company NYSE: DRH is a self-advised real estate investment trust that owns a portfolio of hotels and resort properties in the United States. The company focuses on lodging real estate in leisure destinations and gateway markets, with properties serving business travelers, vacationers, and group customers.

DiamondRock's portfolio includes hotels operated under nationally recognized brands as well as independent and boutique properties. Its business activities include acquiring, owning, leasing, and strategically managing hospitality real estate, while day-to-day hotel operations are generally carried out by third-party management companies and brand operators.

The company was formed in 2004 through a spin-off from Marriott International and is headquartered in Bethesda, Maryland.

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