Diamondrock (DRH) AI Stock Analysis

• Market Cap: $1.87B
• Dividend Yield: 5.16%
• Average Volume (3M): 4.11M
• Price to Earnings (P/E): 34.9
• Beta (1Y): 0.86
• Revenue Growth: 0.95%
• EPS Growth: -8.40%
• Country: US
• Employees: 31
• Sector: Real Estate
• Sector Strength: 53
• Industry: REIT - Hotel & Motel
• EPS (TTM): 0.10
• Shares Outstanding: 203,703,190
• 10 Day Avg. Volume: 4,544,758
• 30 Day Avg. Volume: 4,113,672
• PEG Ratio: -0.79
• Price to Book (P/B): 1.19
• Price to Sales (P/S): 1.68
• P/FCF Ratio: 13.30
• Enterprise Value/Market Cap: 1.42
• Enterprise Value/Revenue: 2.35
• Enterprise Value/Gross Profit: 5.17
• Enterprise Value/Ebitda: 10.95
• 1Y Price Target: $9.20
• Price Target Upside: 0.99% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 6
• EPS Forecast (FY): 0.43
• Revenue Forecast (FY): $1.12B

• Rating: 64 Neutral
• Price Target: $9.50 ▲(4.28% Upside)

Diamondrock's overall stock score reflects stable financial performance and strong earnings call results, which are offset by technical indicators suggesting overbought conditions and a high P/E ratio indicating potential overvaluation. The attractive dividend yield provides some support for the stock.

Positive Factors

Strong Cash Flow Generation

The robust growth in free cash flow indicates efficient operations and provides financial flexibility for investments and debt management.

Successful Debt Refinancing

Refinancing and extending debt maturities improve financial stability and reduce near-term liquidity risks, supporting long-term growth.

Revenue Growth in Ancillary Services

Growth in ancillary services diversifies revenue streams and enhances profitability, reducing reliance on room rentals alone.

Negative Factors

Decline in Leisure and Group Revenue

Declining leisure and group revenues could indicate weakening demand in key segments, potentially impacting future revenue growth.

RevPAR Decline in Resort Portfolio

A decline in RevPAR within the resort portfolio suggests challenges in maintaining pricing power and occupancy, affecting profitability.

Cost Pressures on Margins

Rising costs could compress margins, limiting profitability and reducing the ability to reinvest in growth initiatives.

Diamondrock Business Overview & Revenue Model

Company Description

DiamondRock Hospitality Company is a self-advised real estate investment trust (REIT) that is an owner of a leading portfolio of geographically diversified hotels concentrated in top gateway markets and destination resort locations. The Company owns 31 premium quality hotels with over 10,000 rooms. The Company has strategically positioned its hotels to be operated both under leading global brand families as well as unique boutique hotels in the lifestyle segment.

How the Company Makes Money

DiamondRock generates revenue primarily through the operations of its hotel properties, which include room rentals, food and beverage services, and other ancillary services provided to guests. The company's revenue model is primarily based on the rental income from hotel rooms, which is influenced by occupancy rates and average daily rates (ADR). Additionally, DRH benefits from management fees and incentives when properties exceed performance benchmarks. The company often enters into long-term management agreements with leading hotel operators, which not only enhances its operational capabilities but also aligns its interests with those of its partners. Furthermore, through strategic acquisitions and renovations of properties, DiamondRock seeks to increase the overall value of its portfolio, thereby contributing to its revenue growth.

Diamondrock Financial Statement Overview

Summary

Diamondrock shows stable financial performance with consistent revenue growth and improving profitability metrics. The balance sheet is robust with manageable leverage, and cash flow generation is strong. However, potential risks from cost pressures and high debt levels could impact future profitability and growth.

Income Statement

Diamondrock's income statement shows moderate performance with a gross profit margin of 41.89% and a net profit margin of 5.25% for the TTM. Revenue growth has been positive at 2.3% TTM, although it has slowed compared to previous years. The EBIT and EBITDA margins are 7.96% and 21.30% respectively, indicating stable operational efficiency. However, the decline in gross profit margin from the previous year suggests potential cost pressures.

Balance Sheet

The balance sheet reflects a stable financial position with a debt-to-equity ratio of 0.76, indicating moderate leverage. Return on equity stands at 3.75% TTM, showing a slight improvement. The equity ratio is healthy, suggesting a solid capital structure. However, the relatively high debt level could pose risks if revenue growth slows further.

Cash Flow

Cash flow analysis reveals a positive trend with a 13.1% growth in free cash flow TTM. The operating cash flow to net income ratio is strong at 33.62, indicating efficient cash generation relative to earnings. The free cash flow to net income ratio of 0.54 suggests good cash conversion, though it has decreased from the previous year.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.13B	1.13B	1.07B	1.00B	567.13M	299.49M
Gross Profit	510.71M	617.94M	293.11M	569.14M	282.14M	-41.14M
EBITDA	241.19M	228.90M	263.33M	260.85M	-52.13M	-253.77M
Net Income	63.97M	48.05M	86.34M	109.33M	-194.58M	-394.38M
Balance Sheet
Total Assets	3.15B	3.17B	3.24B	3.21B	2.97B	3.15B
Cash, Cash Equivalents and Short-Term Investments	145.34M	81.38M	121.59M	67.56M	38.62M	111.80M
Total Debt	1.19B	1.18B	1.29B	1.30B	1.18B	1.15B
Total Liabilities	1.57B	1.57B	1.59B	1.61B	1.44B	1.43B
Stockholders Equity	1.57B	1.59B	1.64B	1.59B	1.52B	1.71B
Cash Flow
Free Cash Flow	136.87M	142.82M	118.55M	-43.36M	-276.07M	-173.32M
Operating Cash Flow	251.52M	224.41M	237.56M	206.24M	-2.31M	-83.69M
Investing Cash Flow	-25.63M	-112.12M	-120.85M	-248.60M	-62.20M	-78.97M
Financing Cash Flow	-150.26M	-150.67M	-56.73M	74.03M	5.17M	117.71M

Diamondrock Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 9.11
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DRH, the sentiment is Positive. The current price of 9.11 is above the 20-day moving average (MA) of 8.68, above the 50-day MA of 8.19, and above the 200-day MA of 7.82, indicating a bullish trend. The MACD of 0.25 indicates Negative momentum. The RSI at 65.09 is Neutral, neither overbought nor oversold. The STOCH value of 67.06 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DRH.

Diamondrock Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	65 Neutral	$2.17B	12.19	3.79%	4.94%	3.15%	1.96%
XHR	65 Neutral	$1.33B	25.00	4.58%	3.84%	4.29%	141.01%
DRH	64 Neutral	$1.87B	34.90	3.98%	5.16%	0.95%	-8.40%
RLJ	62 Neutral	$1.10B	150.10	1.49%	7.88%	-0.58%	-83.32%
SHO	61 Neutral	$1.80B	1,890.00	0.88%	3.88%	3.04%	-98.77%
PEB	52 Neutral	$1.29B	―	-3.74%	0.35%	0.99%	-360.58%
PK	52 Neutral	$2.16B	―	-0.36%	13.05%	-3.57%	-104.55%

Diamondrock Corporate Events

DiamondRock Hospitality Exceeds Earnings Expectations Amid Challenges

DiamondRock Hospitality’s recent earnings call conveyed a generally positive sentiment, as the company surpassed expectations in several key areas. The call highlighted strong performance in adjusted EBITDA, out-of-room revenues, and food and beverage margins. However, the company also faced challenges, including declines in certain revenue segments and external pressures such as a federal government shutdown. Despite these challenges, DiamondRock has effectively managed its debt and maintains a robust cash position, showcasing its resilience in the face of adversity.

DiamondRock Hospitality Reports Mixed Q3 2025 Results

DiamondRock Hospitality Company is a self-advised real estate investment trust (REIT) that owns and manages a portfolio of 36 premium hotels and resorts across the United States, focusing on leisure destinations and major gateway markets. The company operates under both global brand families and independent boutique hotels in the lifestyle segment.

DiamondRock Prepays Mortgage Loan for Westin Boston

On September 5, 2025, DiamondRock Hospitality Company prepaid a $166.2 million mortgage loan for the Westin Boston Seaport District, resulting in all of the company’s debt becoming fully unsecured and prepayable at any time. This strategic financial move is part of DiamondRock’s broader efforts to optimize capital allocation, enhance shareholder value, and position itself for continued growth in the hospitality sector.

The most recent analyst rating on (DRH) stock is a Hold with a $8.56 price target. To see the full list of analyst forecasts on Diamondrock stock, see the DRH Stock Forecast page.

DiamondRock Hospitality’s Earnings Call: Achievements and Challenges

DiamondRock Hospitality’s latest earnings call presented a balanced sentiment, highlighting both achievements and challenges. The company celebrated positive financial milestones, such as share repurchases and successful refinancing, while also addressing hurdles in resort portfolio performance, occupancy, and RevPAR growth. Despite these challenges, DiamondRock remains optimistic about future opportunities.

DiamondRock Hospitality Reports Strong Q2 2025 Results

DiamondRock Hospitality Company is a real estate investment trust (REIT) that owns a diverse portfolio of 36 premium hotels and resorts across the United States, focusing on leisure destinations and major gateway markets.