10 Best Hospitality Stocks to Buy According to Hedge Funds

8. DiamondRock Hospitality Company (NYSE:DRH) 

Number of Hedge Fund Investors: 30

DiamondRock Hospitality Company (NYSE:DRH) is a real estate investment trust that owns hotel assets. Its operations include purchasing, holding, operating, and remodeling full-service hotel assets in the US. It operates in several cities, including Chicago, Boston, New York, and Denver. Marriott, Starwood, and Hilton comprise the majority of the hotel brands in DiamondRock’s assets. The revenue is distributed into room, food and beverage, and other categories. The majority of the revenue comes from the room segment. The company’s clientele consists of group clients, business transients, and leisure travelers.

In Q4 of 2024, DiamondRock Hospitality Company (NYSE:DRH)’s Urban hotels performed well, with RevPAR up 8.2% and the average daily rate up 5.4%. This was mostly due to a 13.2% RevPAR spike in December in major markets, including Boston, Chicago, Salt Lake, and San Diego. In Q4, group room revenue grew by 8.1% YoY, contributing to a 6.4% increase in food and beverage revenue. Hotel adjusted EBITDA up 16.4% YoY to $75.9 million, while corporate adjusted EBITDA rose by 20% to $68.7 million.

The Bourbon Orleans and Westin San Diego Bay View renovations increased profits and return on investment. In 2025, DiamondRock Hospitality Company (NYSE:DRH) raised the quarterly dividend from $0.03 to $0.08 per share, with the possibility of an additional stub dividend, making it one of the Best Hospitality Stocks.

The company made several smart decisions, such as paying $30 million to acquire the AC Hotel Minneapolis Downtown and selling the Westin Washington D.C. City Center for $92 million. The completion of the Hotel Champlain Burlington’s completion marks a noteworthy development.