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Host Hotels' (HST) Q1 AFFO Beat Estimates, Revenues Up Y/Y
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Host Hotels & Resorts, Inc. (HST - Free Report) reported first-quarter adjusted funds from operations (AFFO) per share of 60 cents, surpassing the Zacks Consensus Estimate of 54 cents. Moreover, the figure increased 9.1% from the prior-year quarter.
Results reflect year-over-year rise in revenues. However, comparable hotel RevPAR and EBITDA fell in the quarters. The lodging real estate investment trust also raised the 2024 outlook for AFFO per share.
Host Hotels generated total revenues of $1.47 billion, beating the Zacks Consensus Estimate of $1.43 billion. The top line rose 6.5% on a year-over-year basis.
Per James F. Risoleo, president and CEO of the company, “Host delivered comparable hotel Total RevPAR growth of 0.5% over the first quarter of 2023, which is impressive given the challenging comparison of the prior year. Banquet revenues led our performance, driven by improvements in group business and continued strong demand in food and beverage. Given our fortress balance sheet and successful capital allocation execution, we believe Host is well positioned to continue delivering EBITDA growth.”
Behind the Headlines
Host Hotels’ comparable hotel RevPAR was $215.37 in the reported quarter, falling 1.2% from the year-ago quarter’s $218.08. The fall was mainly due to the impacts of the Maui wildfires, unseasonable weather conditions in several markets and unanticipated delays in renovation in the quarter.
Comparable hotel EBITDA came in at $497.3 million, falling 1.8% from $506.5 million reported a year ago.
The average room rate of $314.65 in the first quarter decreased from $318.75 reported in the year-ago quarter.
The comparable average occupancy percentage in the quarter was 68.4%, unchanged from the prior-year quarter.
The room nights for its transient business declined 1.9% year over year. The group business and contract businesses witnessed growth of 4.1% and 7.5%, respectively, from the prior-year period. Host Hotels’ transient, group and contract businesses accounted for roughly 61%, 35% and 4% of its 2023 room sales, respectively.
Balance Sheet Position
Host Hotels exited the first quarter with cash and cash equivalents of $1.35 billion, up from $1.14 billion as of Dec 31, 2023.
HST’s liquidity totaled $1.7 billion, including FF&E escrow reserves of $231 million as of Mar 31, 2024. It had $1.3 billion available under the revolver portion of the credit facility as of the same date.
Capital Expenditure
As of Mar 31, 2024, Host Hotels’ capital expenditure aggregated $103 million. Of this, $33 million was the total return on investment project spend, $58 million was a renewal and replacement expenditure, and $12 million was a renewal and replacement insurable reconstruction.
2024 Outlook
Host Hotels raised its full-year AFFO per share guidance to the range of $1.97-$2.05 from the prior-guided range of $1.92-$2.04. This suggests a 3-cent increase at the midpoint. The Zacks Consensus Estimate is presently pegged at $1.97.
The company revised its comparable hotel RevPAR projection for the current year to $214-$218 from $217-$223 estimated earlier.
The adjusted EBITDAre is now expected between $1.64 billion and $1.70 billion, up from $1.59 billion and $1.68 billion projected earlier.
For 2024, management kept its total capital expenditure guidance unrevised in the range of $500-$605 million.
Ventas, Inc. (VTR - Free Report) reported first-quarter 2024 normalized funds from operations (FFO) per share of 78 cents, beating the Zacks Consensus Estimate of 74 cents. The reported figure increased 5.4% from the prior-year quarter’s tally.
Results reflect better-than-anticipated revenues. Also, Ventas’ same-store cash net operating income (NOI) increased year over year on strong performance across the portfolio, except for triple-net leased properties. It has also raised its 2024 outlook.
Healthpeak Properties, Inc. (DOC - Free Report) reported first-quarter 2024 FFO as adjusted per share of 45 cents, beating the Zacks Consensus Estimate by a penny. The reported figure rose 7.1% from the prior-year quarter.
Results reflect better-than-anticipated revenues. Moreover, growth in total merger-combined same-store cash (adjusted) NOI was witnessed across the portfolio. The company also revised its 2024 outlook.
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.
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Host Hotels' (HST) Q1 AFFO Beat Estimates, Revenues Up Y/Y
Host Hotels & Resorts, Inc. (HST - Free Report) reported first-quarter adjusted funds from operations (AFFO) per share of 60 cents, surpassing the Zacks Consensus Estimate of 54 cents. Moreover, the figure increased 9.1% from the prior-year quarter.
Results reflect year-over-year rise in revenues. However, comparable hotel RevPAR and EBITDA fell in the quarters. The lodging real estate investment trust also raised the 2024 outlook for AFFO per share.
Host Hotels generated total revenues of $1.47 billion, beating the Zacks Consensus Estimate of $1.43 billion. The top line rose 6.5% on a year-over-year basis.
Per James F. Risoleo, president and CEO of the company, “Host delivered comparable hotel Total RevPAR growth of 0.5% over the first quarter of 2023, which is impressive given the challenging comparison of the prior year. Banquet revenues led our performance, driven by improvements in group business and continued strong demand in food and beverage. Given our fortress balance sheet and successful capital allocation execution, we believe Host is well positioned to continue delivering EBITDA growth.”
Behind the Headlines
Host Hotels’ comparable hotel RevPAR was $215.37 in the reported quarter, falling 1.2% from the year-ago quarter’s $218.08. The fall was mainly due to the impacts of the Maui wildfires, unseasonable weather conditions in several markets and unanticipated delays in renovation in the quarter.
Comparable hotel EBITDA came in at $497.3 million, falling 1.8% from $506.5 million reported a year ago.
The average room rate of $314.65 in the first quarter decreased from $318.75 reported in the year-ago quarter.
The comparable average occupancy percentage in the quarter was 68.4%, unchanged from the prior-year quarter.
The room nights for its transient business declined 1.9% year over year. The group business and contract businesses witnessed growth of 4.1% and 7.5%, respectively, from the prior-year period. Host Hotels’ transient, group and contract businesses accounted for roughly 61%, 35% and 4% of its 2023 room sales, respectively.
Balance Sheet Position
Host Hotels exited the first quarter with cash and cash equivalents of $1.35 billion, up from $1.14 billion as of Dec 31, 2023.
HST’s liquidity totaled $1.7 billion, including FF&E escrow reserves of $231 million as of Mar 31, 2024. It had $1.3 billion available under the revolver portion of the credit facility as of the same date.
Capital Expenditure
As of Mar 31, 2024, Host Hotels’ capital expenditure aggregated $103 million. Of this, $33 million was the total return on investment project spend, $58 million was a renewal and replacement expenditure, and $12 million was a renewal and replacement insurable reconstruction.
2024 Outlook
Host Hotels raised its full-year AFFO per share guidance to the range of $1.97-$2.05 from the prior-guided range of $1.92-$2.04. This suggests a 3-cent increase at the midpoint. The Zacks Consensus Estimate is presently pegged at $1.97.
The company revised its comparable hotel RevPAR projection for the current year to $214-$218 from $217-$223 estimated earlier.
The adjusted EBITDAre is now expected between $1.64 billion and $1.70 billion, up from $1.59 billion and $1.68 billion projected earlier.
For 2024, management kept its total capital expenditure guidance unrevised in the range of $500-$605 million.
Host Hotels currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Host Hotels & Resorts, Inc. Price, Consensus and EPS Surprise
Host Hotels & Resorts, Inc. price-consensus-eps-surprise-chart | Host Hotels & Resorts, Inc. Quote
Performance of Other REITs
Ventas, Inc. (VTR - Free Report) reported first-quarter 2024 normalized funds from operations (FFO) per share of 78 cents, beating the Zacks Consensus Estimate of 74 cents. The reported figure increased 5.4% from the prior-year quarter’s tally.
Results reflect better-than-anticipated revenues. Also, Ventas’ same-store cash net operating income (NOI) increased year over year on strong performance across the portfolio, except for triple-net leased properties. It has also raised its 2024 outlook.
Healthpeak Properties, Inc. (DOC - Free Report) reported first-quarter 2024 FFO as adjusted per share of 45 cents, beating the Zacks Consensus Estimate by a penny. The reported figure rose 7.1% from the prior-year quarter.
Results reflect better-than-anticipated revenues. Moreover, growth in total merger-combined same-store cash (adjusted) NOI was witnessed across the portfolio. The company also revised its 2024 outlook.
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.