Sotherly Hotels (SOHO): 3 Reasons Why It Is a Top Choice for Growth Investors – Tale of the Tape

One such company that stands out in this regard is undoubtedly Sotherly Hotels Inc. (SOHO). Not only does this company have a favorable growth score, but it is ranked as a buy too. And while there are numerous reasons why SOHO is so attractive right now, we have highlighted three of the most important—and pertinent to growth investors—below:

Earnings Growth for SOHO

Arguably nothing is more important than earnings growth as surging profit levels is what most investors are after. And for growth investors, earnings growth in the double digits is definitely necessary and it is often an indication of strong prospects (and stock price gains) ahead for the company in question.

While SOHO has put up a historical EPS growth rate of 24.6%, investors should really focus on the projected growth. Here, SOHO is looking to grow at a rate of 14.2%, thoroughly crushing the industry average which calls for EPS growth of just 5.8% in comparison.

Cash Flow Growth for SOHO

Cash is the lifeblood of any business, but especially so for growth oriented companies. A positive figure here indicates that cash is flowing into the business (obviously a good thing), while a negative reading here means that net cash is exiting the company.

Right now, SOHO’s current cash flow growth is an impressive 122.1%, a level that is far higher than many of its peers, and the industry average. In fact, the industry average sees cash flow growth of just 21.2% in comparison, suggesting that SOHO is a better pick from a cash flow look.

Bottom Line

For the reasons outlined above, investors shouldn’t be surprised to note that Sotherly Hotels has earned itself a growth score of ‘B’ as well as a Zacks Rank #2 (Buy). This means that we believe Sotherly Hotels stock is a potential outperformer that is an impressive choice for growth investors, making it a security that you need to keep on your radar in the near term.

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