PK - Park Hotels & Resorts: Valuation Appears Stretched After Recent Outperformance

2024-04-15 14:02:46 ET

Summary

• Park Hotels & Resorts has outperformed the Vanguard Real Estate Index Fund ETF by close to 20% this year.
• RevPAR grew 4.1% Y/Y in Q4 2023, with a similar increase of about 4.5% projected for 2024.
• The company's debt is entirely fixed-rate with an average interest rate of 5.24%.
• The market cap rate is ~4.4% after accounting for capex spending.
• Even if the REIT made a full recovery to 2019 hotel adjusted EBITDA, the market cap rate would be in line with peers such as RLJ Lodging.

Introduction

Park Hotels & Resorts ( PK ) is a lodging REIT that has significantly outperformed the sector Vanguard Real Estate Index Fund ETF ( VNQ ) year-to-date:

For further details see: