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Summit Hotel Properties (INN) Moves 7.9% Higher: Will This Strength Last?

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Summit Hotel Properties (INN - Free Report) shares rallied 7.9% in the last trading session to close at $7.34. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 21.5% loss over the past four weeks.

This increased optimism reflects the recovering fundamentals of the overall lodging industry. Moreover, recently the company announced that it completed the acquisition of the AC Hotel by Marriott & Element Miami Brickell. The 264-guestroom dual-branded property was acquired for $89 million.

This real estate investment trust specializing in higher end hotels is expected to post quarterly funds from operations (FFO) of $0.28 per share in its upcoming report, which represents a year-over-year change of +250%. Revenues are expected to be $174.37 million, up 101.5% from the year-ago quarter.

FFO and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in FFO estimate revisions are strongly correlated with near-term stock price movements.

For Summit Hotel Properties, the consensus FFO per share estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in FFO estimate revisions. So, make sure to keep an eye on INN going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Summit Hotel Properties belongs to the Zacks REIT and Equity Trust - Other industry. Another stock from the same industry, The Necessity Retail , closed the last trading session 1.7% higher at $7.35. Over the past month, RTL has returned -7.4%.

For The Necessity Retail, the consensus FFO per share estimate for the upcoming report has remained unchanged over the past month at $0.27. This represents a change of +3.9% from what the company reported a year ago. The Necessity Retail currently has a Zacks Rank of #2 (Buy).


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