Sotherly Hotels (SOHO) AI Stock Analysis

• Market Cap: $29.98M
• Dividend Yield: N/A
• Average Volume (3M): 34.00K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.77
• Revenue Growth: 1.78%
• EPS Growth: -33.00%
• Country: US
• Employees: 9
• Sector: Real Estate
• Sector Strength: 48
• Industry: REIT - Hotel & Motel
• EPS (TTM): -0.02
• Shares Outstanding: 20,490,501
• 10 Day Avg. Volume: 62,855
• 30 Day Avg. Volume: 34,002
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 11.20
• Enterprise Value/Revenue: 1.83
• Enterprise Value/Gross Profit: 7.09
• Enterprise Value/Ebitda: 7.35
• 1Y Price Target: $1.00
• Price Target Upside: 36.99% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1

• Rating: 54 Neutral
• Price Target: $1.00 ▲(36.99% Upside)

Sotherly Hotels' overall stock score reflects a challenging financial position with high leverage and negative valuation metrics. While there are signs of recovery in income and cash flow, technical indicators and recent corporate events suggest ongoing risks. The company's proactive debt management and targeted revenue strategies are positive, but economic uncertainties and government spending cuts pose significant challenges.

Sotherly Hotels Business Overview & Revenue Model

Company Description

Sotherly Hotels Inc. is a self-managed and self-administered lodging REIT focused on the acquisition, renovation, upbranding and repositioning of upscale to upper-upscale full-service hotels in the Southern United States. Currently, the Company's portfolio consists of investments in twelve hotel properties, comprising 3,156 rooms, as well as interests in two condominium hotels and their associated rental programs. The Company owns hotels that operate under the Hilton Worldwide, Hyatt Hotels Corporation, and Marriott International, Inc. brands, as well as independent hotels. Sotherly Hotels Inc. was organized in 2004 and is headquartered in Williamsburg, Virginia.

How the Company Makes Money

Sotherly Hotels generates revenue primarily through the operation of its hotel properties, which include room rentals, food and beverage sales, and event hosting services. The core revenue streams consist of occupancy rates and average daily rates (ADR) achieved through effective pricing strategies and marketing initiatives. Additionally, Sotherly may earn income from management fees associated with properties it manages for third-party owners. Key partnerships with travel agencies, online travel platforms, and corporate clients also contribute to its revenue, enabling the company to attract a steady flow of guests. Seasonal demand fluctuations, local economic conditions, and strategic property acquisitions further influence the company's earnings potential.

Sotherly Hotels Financial Statement Overview

Summary

Sotherly Hotels shows a recovery trajectory with positive revenue growth and improved profitability metrics. However, the balance sheet reveals high leverage and financial risks due to a significant debt-to-equity ratio. Cash flows are stabilizing but need further improvement.

Income Statement

Sotherly Hotels' income statement shows a steady revenue growth trend with a TTM revenue increase from $181.89M to $183.66M. Gross profit margin remains solid at approximately 25.8%, with an EBIT margin of 11.5% and an EBITDA margin of 24.9%. However, the net profit margin has been volatile, with the TTM net income showing improvement to $4.65M. Despite past challenges, profitability is on an upward trajectory.

Balance Sheet

The balance sheet indicates high leverage with a significant debt-to-equity ratio of over 500, reflecting potential financial risk. The equity ratio stands at approximately 11%, indicating limited equity relative to total assets. Return on equity is improving, shown by the TTM net income growth. Despite high debt levels, the company's financial position has shown gradual recovery.

Cash Flow

Cash flow analysis shows positive operating cash flow with a TTM value of $26M, consistent with historical data. Free cash flow has improved with a positive TTM figure, indicating better cash management. However, the free cash flow to net income ratio suggests that cash flow generation relative to net income could be more robust. Overall, cash flows are stabilizing but remain an area to monitor.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	183.66M	181.89M	173.84M	166.08M	127.59M	71.50M
Gross Profit	47.37M	46.81M	44.79M	46.46M	30.69M	-3.22M
EBITDA	45.68M	41.58M	39.88M	72.91M	14.08M	-10.70M
Net Income	4.65M	1.30M	3.94M	32.54M	-26.22M	-49.19M
Balance Sheet
Total Assets	418.09M	414.38M	393.44M	406.57M	436.05M	473.03M
Cash, Cash Equivalents and Short-Term Investments	11.51M	7.33M	17.10M	21.92M	13.17M	25.30M
Total Debt	339.34M	340.38M	317.53M	323.03M	377.91M	386.96M
Total Liabilities	373.43M	372.78M	345.54M	355.05M	419.55M	428.83M
Stockholders Equity	46.07M	43.05M	49.23M	52.25M	21.26M	49.55M
Cash Flow
Free Cash Flow	21.70M	25.89M	21.40M	-1.31M	-854.34K	-15.28M
Operating Cash Flow	26.00M	25.89M	21.40M	6.66M	2.32M	-11.26M
Investing Cash Flow	-12.25M	-14.14M	-6.73M	46.66M	-2.39M	-3.78M
Financing Cash Flow	-20.57M	-9.27M	-15.78M	-51.55M	-9.66M	22.36M

Sotherly Hotels Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.73
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SOHO, the sentiment is Negative. The current price of 0.73 is below the 20-day moving average (MA) of 0.82, below the 50-day MA of 0.88, and below the 200-day MA of 0.86, indicating a bearish trend. The MACD of -0.04 indicates Positive momentum. The RSI at 33.00 is Neutral, neither overbought nor oversold. The STOCH value of 7.67 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SOHO.

Sotherly Hotels Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
INN	68 Neutral	$645.64M	41.24	0.93%	6.21%	-1.91%	-256.67%
Sector *	62 Neutral	AU$3.09B	14.60	3.06%	4.99%	25.15%	80.76%
CLDT	61 Neutral	$355.09M	273.58	1.22%	4.41%	-0.87%	―
BHR	58 Neutral	$145.31M	―	-0.07%	9.52%	-3.68%	38.92%
SOHO	54 Neutral	$29.98M	―	3.37%	―	1.78%	-33.00%
IHT	48 Neutral	$23.78M	―	-25.86%	1.06%	-0.89%	-702.65%
AHT	42 Neutral	$37.28M	―	-25.85%	―	-11.83%	-4186.83%

Sotherly Hotels Corporate Events

Sotherly Hotels Granted Extension for Nasdaq Compliance

On August 12, 2025, Sotherly Hotels Inc. received a notification from Nasdaq granting an additional 180 days, until February 9, 2026, to meet the minimum bid price requirement of $1.00 per share for continued listing on the Nasdaq Capital Market. The company’s stock will move from the Nasdaq Global Select Market to the Nasdaq Capital Market, effective August 14, 2025, as part of this compliance effort. If the company fails to meet the requirement by the deadline, its stock may face delisting, although the company can appeal such a decision. Sotherly Hotels plans to monitor its stock price and consider options like a reverse stock split to regain compliance.

Sotherly Hotels Sells Parking Garage for $17.75M

On July 24, 2025, Sotherly Hotels Inc., through its affiliate SOHO Atlanta, LLC, entered into an agreement to sell the parking garage associated with the Georgian Terrace hotel in Atlanta, Georgia, to Banyan Street Capital LLC for $17.75 million. The proceeds from this sale are intended to reduce the principal balance on the existing mortgage for the hotel, following a Notice of Default received from the special servicer for its mortgage loan. The transaction is expected to close in the fourth quarter of 2025, pending various closing conditions.

Sotherly Hotels Sets Deadline for Stockholder Proposals

Sotherly Hotels Inc. has announced that its 2025 Annual Meeting of Stockholders will be held on November 17, 2025, with a record date set for September 18, 2025. The company has set a new deadline for stockholder proposals for inclusion in the 2025 proxy statement, which must be submitted by July 28, 2025, to comply with Rule 14a-8 under the Securities Exchange Act of 1934. This announcement impacts stockholders by informing them of the necessary timelines and requirements for proposal submissions and director nominations.

Sotherly Hotels Faces Notice of Default on Loan

On July 2, 2025, Sotherly Hotels Inc. announced it had received a Notice of Default from the special servicer for its mortgage loan secured by the Georgian Terrace in Atlanta. The default, which involves a financial obligation of approximately $38 million, was anticipated and is attributed to a maturity default rather than an inability to meet ongoing interest requirements. The company is negotiating for an extension of the loan and intends to continue making necessary payments in the interim. This situation highlights the challenges faced by the commercial real estate sector, particularly with tighter underwriting standards and higher interest rates, which have made maturity defaults more common.