RMR - Service Properties Trust: Hidden Value In Sonesta
2024-03-27 17:12:45 ET
Summary
- Service Properties Trust is a hybrid hotel and triple net REIT trading at a deep value multiple of 4.4X forward consensus FFO.
- Service Properties' interest expense will increase as cheap fixed rate debt matures and gets refinanced.
- Sonesta International Hotel Corporation is undervalued and underappreciated.
Service Properties Trust ( SVC ) is a hybrid hotel and triple net real estate investment trust, or REIT, that trades at the deep value multiple of 4.4X forward consensus Funds from Operations ((FFO)). SVC should trade at a discounted multiple for 2 main reasons:
- Managed by The RMR Group ( RMR )
- Hotels generally trade at the cheaper end of the multiple spectrum.