Diamondrock (DRH)
NASDAQ:DRH
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Diamondrock
(NASDAQ:DRH)
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Rating:67Neutral
Price Target:
$11.00
â–²(7.74% Upside)
Action:ReiteratedDate:03/03/26
The score is driven primarily by improving fundamentals and cash-flow strength versus prior downturn years, tempered by revenue volatility and balance-sheet data uncertainty. Technicals add support with a clear uptrend and positive momentum. Valuation is mixed: an attractive ~4% yield is offset by a ~22.8 P/E. The earnings call was constructive with modest-growth guidance and shareholder-friendly capital allocation, but near-term demand and cost pressures remain.
Positive Factors
Cash generation & FCF conversion
Consistent positive operating cash flow and a sizable 2025 free cash flow demonstrate strong ability to convert earnings into distributable cash. Durable FCF underpins dividends, buybacks and capital recycling, improving resilience across lodging cycles and enabling shareholder returns.
Negative Factors
High revenue cyclicality
Large revenue swings reflect inherent lodging cyclicality; steep 2025 declines show earnings and cash flow remain sensitive to demand shocks. That volatility can pressure dividend sustainability, hinder multi-year planning, and increase execution risk for capital recycling strategies.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash generation & FCF conversion
Consistent positive operating cash flow and a sizable 2025 free cash flow demonstrate strong ability to convert earnings into distributable cash. Durable FCF underpins dividends, buybacks and capital recycling, improving resilience across lodging cycles and enabling shareholder returns.
Read all positive factors
Diamondrock (DRH) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.08B
Dividend Yield5.13%
Average Volume (3M)1.90M
Price to Earnings (P/E)18.2
Beta (1Y)0.83
Revenue Growth0.95%
EPS Growth-8.40%
CountryUS
Employees31
SectorReal Estate
Sector Strength53
IndustryREIT - Hotel & Motel
Share Statistics
EPS (TTM)0.12
Shares Outstanding203,703,190
10 Day Avg. Volume1,662,936
30 Day Avg. Volume1,895,966
Financial Highlights & Ratios
PEG Ratio0.13
Price to Book (P/B)1.28
Price to Sales (P/S)1.65
P/FCF Ratio11.40
Enterprise Value/Market Cap1.53
Enterprise Value/Revenue2.85
Enterprise Value/Gross Profit5.17
Enterprise Value/Ebitda11.63
Forecast
1Y Price Target
$10.31Price Target Upside0.98% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering8
EPS Forecast (FY)0.53
Revenue Forecast (FY)$1.15B
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 ow...
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 ...
Diamondrock Earnings Call Summary
Earnings Call Date:Feb 26, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 30, 2026
Earnings Call Sentiment Positive
The call portrayed a company with clear operational and capital allocation strengths: record FFO, free cash flow growth, margin expansion, disciplined lower-percentage CapEx, successful renovations driving outsized returns, and a simplified balance sheet. These highlights outweigh near-term operating headwinds including a modest Q4 RevPAR decline, group demand softness, resort-specific disruptions, and expected labor cost increases. Guidance is measured and the firm emphasizes converting top-line performance into FFO/free cash flow growth. While there are identifiable near-term risks (first-quarter comps, booking shocks, and segment bifurcation), the strategic positioning and balance-sheet actions support a constructive outlook.Positive Updates
Record FFO and Strong Free Cash Flow
Full-year 2025 adjusted FFO per share of $1.08 (company record) and free cash flow per share of $0.69, a 6% increase over 2024 and a 22% increase versus 2023.
Negative Updates
Q4 RevPAR Softness and Occupancy Pressure
Comparable RevPAR declined 30 basis points in Q4 2025; occupancy fell 130 basis points year-over-year while ADR rose only 1.6%.
Read all updates
Q4-2025 Updates
Positive
Negative
Record FFO and Strong Free Cash Flow
Full-year 2025 adjusted FFO per share of $1.08 (company record) and free cash flow per share of $0.69, a 6% increase over 2024 and a 22% increase versus 2023.
Read all positive updates
Company Guidance
On guidance, management expects 2026 RevPAR growth of 1%–3% (total RevPAR ~25 bps higher), adjusted EBITDA of $287M–$302M, FFO per share roughly $1.06–$1.90, and capital expenditures of $80M–$90M; they said the midpoint implies ~2% RevPAR and about a 4% increase in both FFO and free cash flow per share, Q1 RevPAR should be essentially flat (with Q1 EBITDA and FFO as a % of the year below 2025), and they plan to declare quarterly dividends of $0.90 per share (with a potential Q4 stub). Management also noted $149M of group room revenue on the books (flat vs. 2025), the Series A preferred redemption will be ~+$0.03 to 2026 FFO, the balance sheet has no maturities until 2029 and ~70% floating-rate debt, and the company continues to target disciplined capital recycling and share repurchases where accretive.Diamondrock Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
55
Neutral
Cash Flow
68
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.12B | 1.13B | 1.07B | 1.00B | 567.13M |
| Gross Profit | 618.35M | 617.94M | 293.11M | 569.14M | 282.14M |
| EBITDA | 274.64M | 228.90M | 263.33M | 260.85M | -52.13M |
| Net Income | 101.43M | 48.05M | 86.34M | 109.33M | -194.58M |
Balance Sheet | |||||
| Total Assets | 3.00B | 3.17B | 3.24B | 3.21B | 2.97B |
| Cash, Cash Equivalents and Short-Term Investments | 68.08M | 81.38M | 121.59M | 67.56M | 38.62M |
| Total Debt | 1.19B | 1.18B | 1.29B | 1.30B | 1.18B |
| Total Liabilities | 1.55B | 1.57B | 1.59B | 1.61B | 1.44B |
| Stockholders Equity | 1.45B | 1.59B | 1.64B | 1.59B | 1.52B |
Cash Flow | |||||
| Free Cash Flow | 162.09M | 142.82M | 118.55M | -43.36M | -276.07M |
| Operating Cash Flow | 243.65M | 224.41M | 237.56M | 206.24M | -2.31M |
| Investing Cash Flow | 7.46M | -112.12M | -120.85M | -248.60M | -62.20M |
| Financing Cash Flow | -276.68M | -150.67M | -56.73M | 74.03M | 5.17M |
Diamondrock Technical Analysis
Positive
10.21
Price Trends
9.59
Positive
9.27
Positive
8.55
Positive
Market Momentum
0.13
Negative
69.39
Neutral
91.74
Negative
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 10.21 is above the 20-day moving average (MA) of 9.50, above the 50-day MA of 9.59, and above the 200-day MA of 8.55, indicating a bullish trend. The MACD of 0.13 indicates Negative momentum. The RSI at 69.39 is Neutral, neither overbought nor oversold. The STOCH value of 91.74 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DRH.
Diamondrock Risk Analysis
Diamondrock disclosed 51 risk factors in its most recent earnings report. Diamondrock reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Diamondrock Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
67 Neutral | $2.08B | 18.22 | 6.59% | 5.13% | 0.95% | -8.40% | |
65 Neutral | $2.17B | 12.19 | 3.79% | 4.94% | 3.15% | 1.96% | |
64 Neutral | $1.81B | 70.45 | 1.23% | 3.98% | 3.04% | -98.77% | |
63 Neutral | $2.26B | -2.54 | -8.42% | 13.10% | -3.57% | -104.55% | |
62 Neutral | $1.54B | -20.13 | -2.57% | 0.34% | 0.99% | -360.58% | |
62 Neutral | $1.20B | 645.83 | 1.29% | 7.76% | -0.58% | -83.32% | |
62 Neutral | $1.46B | 21.68 | 5.33% | 3.71% | 4.29% | 141.01% |
* Real Estate Sector Average
DRH
Diamondrock
10.21
3.51
52.27%
SHO
Sunstone Hotel
9.57
1.59
19.97%
PEB
Pebblebrook Hotel
13.77
5.26
61.83%
RLJ
RLJ Lodging
8.04
1.75
27.80%
XHR
Xenia Hotels & Resorts
16.10
6.73
71.75%
PK
Park Hotels & Resorts
11.19
2.41
27.43%
Diamondrock Corporate Events
Business Operations and StrategyStock BuybackFinancial Disclosures
DiamondRock Highlights Strategy to Drive Long-Term Shareholder Value
Positive
Mar 2, 2026
DiamondRock Hospitality has released a March 2026 investor presentation outlining its strategy to drive long-term shareholder value through disciplined capital allocation, cost control and portfolio optimization. The company highlights initiatives...
Executive/Board ChangesShareholder Meetings
DiamondRock Announces Board Leadership Transition and Succession Plan
Neutral
Feb 25, 2026
DiamondRock Hospitality said on February 25, 2026, that longtime Chairman and founder William W. McCarten will retire from its board at the end of his current term, effective at the close of the April 29, 2026 annual shareholder meeting. McCarten,...
Business Operations and StrategyStock Buyback
DiamondRock Highlights Strategic Focus on Shareholder Value
Positive
Dec 8, 2025
DiamondRock Hospitality Company has released a presentation intended for investor meetings, highlighting its strategic focus on capital recycling and shareholder value creation. The company has been actively managing its portfolio by repurchasing ...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.