We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Host Hotels Sells Stake in European JV, Sheds Global Exposure
Read MoreHide Full Article
Host Hotels & Resorts, Inc. (HST - Free Report) recently announced the closing of the sale of its 33% stake in the European joint venture (JV) to its partners. The move comes as part of the company’s efforts to shed its portfolio of assets situated outside the nation and rather focus on the U.S. market where the company enjoys scale and competitive advantage.
Particularly, Host Hotels’ stakes gross asset value is around €700 million and after accounting for fund level debt, net proceeds to the company will amount to €435 million. Part of the proceeds will be used by the company to pay back about €207 million draw on the credit facility.
In fact, Host Hotels undertakes a strategic capital-recycling program to improve its portfolio quality and strengthen the company’s position over vibrant markets. Earlier this year, Host Hotels completed the acquisition of 301-room Andaz Maui at Wailea Resort, 668-room Grand Hyatt San Francisco and 454-room Hyatt Regency Coconut Point Resort and Spa for $1 billion.
Furthermore, Host Hotels made efforts to enhance its portfolio quality through strategic dispositions, aiming at lowering the company’s international and New York exposure. With these proceeds, the company has flexibility to add properties to its portfolio, invest in existing assets or go for share repurchases.
Additionally, during the Jul-Sep quarter, the company expended around $119 million on capital expenditures — $48 million was return on investment (ROI) capital projects, and $71 million for renewal and replacement projects. Also, the company projects capital expenditures of $475-$520 million for the year. This comprises $195-$220 million in ROI projects, and $280-$300 million in renewal and replacement projects. Such investments are likely to help the company improve its portfolio quality and bolster revenues over the long term.
Moreover, the latest move would bolster the company’s balance sheet and drive its capability to make strategic investments and at the same lower its exposure to international assets with the company now set to reap less than 2% of its EBITDA from hotels outside the nation with only two hotels in Canada and three hotels in Brazil.
However, elevated supply in some of the company’s key markets is expected to affect its pricing power. Moreover, dilutive impact on earnings from sale of assets and hike in interest rate adds to its woes.
Host Hotels currently has a Zacks Rank #3 (Hold). The company’s shares have depreciated 13.7% in the past month, which is wider than its industry’s decline of 5.8%.
Lamar’s FFO per share estimates for 2018 has been revised marginally upward to $5.42 in the last 60 days.
PS Business Parks’ Zacks Consensus Estimate for 2018 FFO per share moved 0.9% north to $6.45 in the past two months.
Outfront Media’s FFO per share estimates for the current year has been revised 2% upward to $2.09 in two months’ time.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Image: Bigstock
Host Hotels Sells Stake in European JV, Sheds Global Exposure
Host Hotels & Resorts, Inc. (HST - Free Report) recently announced the closing of the sale of its 33% stake in the European joint venture (JV) to its partners. The move comes as part of the company’s efforts to shed its portfolio of assets situated outside the nation and rather focus on the U.S. market where the company enjoys scale and competitive advantage.
Particularly, Host Hotels’ stakes gross asset value is around €700 million and after accounting for fund level debt, net proceeds to the company will amount to €435 million. Part of the proceeds will be used by the company to pay back about €207 million draw on the credit facility.
In fact, Host Hotels undertakes a strategic capital-recycling program to improve its portfolio quality and strengthen the company’s position over vibrant markets. Earlier this year, Host Hotels completed the acquisition of 301-room Andaz Maui at Wailea Resort, 668-room Grand Hyatt San Francisco and 454-room Hyatt Regency Coconut Point Resort and Spa for $1 billion.
Furthermore, Host Hotels made efforts to enhance its portfolio quality through strategic dispositions, aiming at lowering the company’s international and New York exposure. With these proceeds, the company has flexibility to add properties to its portfolio, invest in existing assets or go for share repurchases.
Additionally, during the Jul-Sep quarter, the company expended around $119 million on capital expenditures — $48 million was return on investment (ROI) capital projects, and $71 million for renewal and replacement projects. Also, the company projects capital expenditures of $475-$520 million for the year. This comprises $195-$220 million in ROI projects, and $280-$300 million in renewal and replacement projects. Such investments are likely to help the company improve its portfolio quality and bolster revenues over the long term.
Moreover, the latest move would bolster the company’s balance sheet and drive its capability to make strategic investments and at the same lower its exposure to international assets with the company now set to reap less than 2% of its EBITDA from hotels outside the nation with only two hotels in Canada and three hotels in Brazil.
However, elevated supply in some of the company’s key markets is expected to affect its pricing power. Moreover, dilutive impact on earnings from sale of assets and hike in interest rate adds to its woes.
Host Hotels currently has a Zacks Rank #3 (Hold). The company’s shares have depreciated 13.7% in the past month, which is wider than its industry’s decline of 5.8%.
Stocks to Consider
Better-ranked stocks from the real-estate space include Lamar Advertising Company (LAMR - Free Report) , PS Business Parks, Inc. and Outfront Media Inc. (OUT - Free Report) . Each of these stocks carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Lamar’s FFO per share estimates for 2018 has been revised marginally upward to $5.42 in the last 60 days.
PS Business Parks’ Zacks Consensus Estimate for 2018 FFO per share moved 0.9% north to $6.45 in the past two months.
Outfront Media’s FFO per share estimates for the current year has been revised 2% upward to $2.09 in two months’ time.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>