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Host Hotels' (HST) Q4 FFO and Revenues Trump Estimates
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Host Hotels & Resorts, Inc. (HST - Free Report) reported fourth-quarter 2019 adjusted funds from operations (FFO) per share of 41 cents, outpacing the Zacks Consensus Estimate of 40 cents. However, the reported figure fell 4.7% from the year-ago tally of 43 cents.
Results reflect improvement in total revenues on a comparable hotel basis. However, the net effect of acquisitions and dispositions partly offset the positives.
The company generated total revenues of $1.3 billion, surpassing the Zacks Consensus Estimate by 0.8%. However, the top line declined nearly 2% year over year.
For full-year 2019, Host Hotels reported an adjusted FFO per share of $1.78, up 0.6% from the prior-year figure of $1.77. Revenues for the full year came in at $5.5 billion, reflecting a decline of 1% year on year.
Behind the Headlines
During the fourth quarter, comparable hotel revenues inched up 1.9% year over year to $1.1 billion. Moreover, comparable hotel total RevPAR (on a constant-dollar basis) went up 1.9% year over year to $292.4 million. This upside resulted from improvement in food and beverage revenues as well as growth in other revenues.
For domestic properties, comparable hotel total RevPAR (on a nominal-dollar basis) inched up 1.7%, while the same for International properties increased 6.9%.
For the December-end quarter, comparable hotel EBITDA moved up 1.3% to $312 million, while comparable hotel EBITDA margin shrunk 10 basis points (bps) to 28.1%.
Finally, the company exited fourth-quarter 2019 with $1.6 billion of unrestricted cash, not including $176 million in the FF&E escrow reserve and $1.5 billion of available balance under its credit facility’s revolver. In addition, as of Dec 31, 2019, total debt was $3.8 billion, with average maturity of 5.4 years and average interest rate of 3.8%.
Host Hotels repurchased 4.7 million shares at an average price of $17.39 per share, aggregating $82 million in the reported quarter. At present, the company has $391 million of capacity available under its repurchase program.
In October, the company sold the Hyatt Regency Cambridge and the Sheraton San Diego Hotel & Marina for a total of $297 million.
During the October-December period, the company invested around $166 million in capital expenditures. Of this, $125 million were return on investment (ROI) capital projects, and $41 million were renewal and replacement projects.
Outlook
Host Hotels expects 2020 adjusted FFO per share of $1.65-$1.71. The Zacks Consensus Estimate for the same is currently pinned at $1.68.
The company’s full-year projection assumes total comparable hotel RevPAR (constant U.S. dollar basis) growth of 0-1%. Additionally, the company projects capital expenditures of $550-$650 million for the year. This includes $310-$360 million in ROI projects, and $240-$290 million in renewal and replacement projects.
Dividend Update
On Feb 19, the company announced a regular quarterly cash dividend of 20 cents per share. The dividend will be paid on Apr 15, to stockholders of record on Mar 31, 2020.
Host Hotels & Resorts, Inc. Price, Consensus and EPS Surprise
We, now, look forward to the earnings releases of other REITs like Public Storage (PSA - Free Report) , American Tower Corporation (AMT - Free Report) and Mack-Cali Realty Corporation , all of which are slated to report their quarterly numbers next week.
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) Q4 FFO and Revenues Trump Estimates
Host Hotels & Resorts, Inc. (HST - Free Report) reported fourth-quarter 2019 adjusted funds from operations (FFO) per share of 41 cents, outpacing the Zacks Consensus Estimate of 40 cents. However, the reported figure fell 4.7% from the year-ago tally of 43 cents.
Results reflect improvement in total revenues on a comparable hotel basis. However, the net effect of acquisitions and dispositions partly offset the positives.
The company generated total revenues of $1.3 billion, surpassing the Zacks Consensus Estimate by 0.8%. However, the top line declined nearly 2% year over year.
For full-year 2019, Host Hotels reported an adjusted FFO per share of $1.78, up 0.6% from the prior-year figure of $1.77. Revenues for the full year came in at $5.5 billion, reflecting a decline of 1% year on year.
Behind the Headlines
During the fourth quarter, comparable hotel revenues inched up 1.9% year over year to $1.1 billion. Moreover, comparable hotel total RevPAR (on a constant-dollar basis) went up 1.9% year over year to $292.4 million. This upside resulted from improvement in food and beverage revenues as well as growth in other revenues.
For domestic properties, comparable hotel total RevPAR (on a nominal-dollar basis) inched up 1.7%, while the same for International properties increased 6.9%.
For the December-end quarter, comparable hotel EBITDA moved up 1.3% to $312 million, while comparable hotel EBITDA margin shrunk 10 basis points (bps) to 28.1%.
Finally, the company exited fourth-quarter 2019 with $1.6 billion of unrestricted cash, not including $176 million in the FF&E escrow reserve and $1.5 billion of available balance under its credit facility’s revolver. In addition, as of Dec 31, 2019, total debt was $3.8 billion, with average maturity of 5.4 years and average interest rate of 3.8%.
Host Hotels repurchased 4.7 million shares at an average price of $17.39 per share, aggregating $82 million in the reported quarter. At present, the company has $391 million of capacity available under its repurchase program.
In October, the company sold the Hyatt Regency Cambridge and the Sheraton San Diego Hotel & Marina for a total of $297 million.
During the October-December period, the company invested around $166 million in capital expenditures. Of this, $125 million were return on investment (ROI) capital projects, and $41 million were renewal and replacement projects.
Outlook
Host Hotels expects 2020 adjusted FFO per share of $1.65-$1.71. The Zacks Consensus Estimate for the same is currently pinned at $1.68.
The company’s full-year projection assumes total comparable hotel RevPAR (constant U.S. dollar basis) growth of 0-1%. Additionally, the company projects capital expenditures of $550-$650 million for the year. This includes $310-$360 million in ROI projects, and $240-$290 million in renewal and replacement projects.
Dividend Update
On Feb 19, the company announced a regular quarterly cash dividend of 20 cents per share. The dividend will be paid on Apr 15, to stockholders of record on Mar 31, 2020.
Host Hotels & Resorts, Inc. Price, Consensus and EPS Surprise
Host Hotels & Resorts, Inc. price-consensus-eps-surprise-chart | Host Hotels & Resorts, Inc. Quote
Host Hotel currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
We, now, look forward to the earnings releases of other REITs like Public Storage (PSA - Free Report) , American Tower Corporation (AMT - Free Report) and Mack-Cali Realty Corporation , all of which are slated to report their quarterly numbers next week.
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.
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 8 stocks to watch. The report is only available for a limited time.
See 8 breakthrough stocks now>>