Back to top

Analyst Blog

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at support@zacks.com or call 800-767-3771 ext.  9339.

Bethesda, Md.-based real estate investment trust (REIT) RLJ Lodging Trust (RLJ - Snapshot Report) recently announced the closure of its previously announced public offering. The company priced the public offering of 15.9 million common shares at $21.60 per share, including 2.07 million shares sold to underwriters to cover the over-allotments.

RLJ Lodging generated net proceeds of around $327.6 million (after deducting the underwriting discount and other estimated offering costs) from the offering. The company plans to direct the net proceeds toward funding prospective acquisitions and for other corporate purposes. Also, RLJ Lodging expects to utilize the amount to timely pay off its outstanding balance under its unsecured revolving credit facility.

At the end of 2012, RLJ Lodging had $115.9 million worth of unrestricted cash and $284.0 million available under its unsecured revolving credit facility.

BofA Merrill Lynch of Bank of America Corporation (BAC - Analyst Report), Barclays PLC (BCS - Snapshot Report) and Wells Fargo Securities of Wells Fargo & Company (WFC - Analyst Report) acted as joint book-running managers for the public offering. On the other hand, PNC Capital Markets LLC, RBC Capital Markets and Deutsche Bank Securities acted as senior co-managers.

For RLJ Lodging, though the public offering would result in share dilution, the payment of debt is encouraging as it would reduce interest expenses. Moreover, the opportunistic acquisitions would help RLJ Lodging enhance its portfolio quality, which in turn would be accretive to its earnings going forward.

As a matter of fact, RLJ Lodging has been on an acquisition spree. Recently, the company acquired the historic Humble Oil Building complex in downtown Houston for $79.5 Million. The complex comprised 1 planned hotel conversion and 2 existing premium-branded hotels – Courtyard Houston Downtown Convention Center and Residence Inn Houston Downtown Convention Center.

Founded in 2000, RLJ Lodging invests in real estate markets and manages real estate funds in the U.S. It focuses on the acquisition of premium-branded, focused-service and compact full-service hotels. Currently, RLJ Lodging’s portfolio consists of 147 hotels and 1 planned hotel conversion located across 21 states and the District of Columbia.

RLJ Lodging currently carries a Zacks Rank #3 (Hold).

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
DIXIE GRP IN DXYN 15.84 +7.90%
BOFI HLDG IN BOFI 85.30 +4.97%
RAMBUS INC RMBS 12.31 +4.41%
VIPSHOP HOLD VIPS 148.73 +4.35%
NETFLIX INC NFLX 345.74 +4.32%