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Service Properties Trust (SVC)
NASDAQ:SVC
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Service Properties (SVC) AI Stock Analysis

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SVC

Service Properties

(NASDAQ:SVC)

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Neutral 47 (OpenAI - 4o)
Rating:47Neutral
Price Target:
$2.00
▲(0.00% Upside)
The overall stock score of 47 reflects significant financial challenges, with negative profitability margins and high leverage being the most critical factors. Technical analysis shows bearish momentum, and the valuation is concerning due to a negative P/E ratio. While the earnings call highlighted some strategic progress, the overall sentiment remains cautious due to ongoing industry headwinds and operational challenges.

Service Properties (SVC) vs. SPDR S&P 500 ETF (SPY)

Service Properties Business Overview & Revenue Model

Company DescriptionService Properties Trust is a real estate investment trust, or REIT, which owns a diverse portfolio of hotels and net lease service and necessity-based retail properties across the United States and in Puerto Rico and Canada with 149 distinct brands across 23 industries. SVC's properties are primarily operated under long-term management or lease agreements. SVC is managed by the operating subsidiary of The RMR Group Inc. (Nasdaq: RMR), or RMR Inc., an alternative asset management company that is headquartered in Newton, Massachusetts.
How the Company Makes MoneyService Properties Trust generates revenue primarily through long-term lease agreements with hospitality and healthcare operators. The company earns rental income from its portfolio of properties, which includes hotels, senior living facilities, and wellness centers. Additionally, SVC may benefit from management fees, as some of its properties are operated by third-party management companies, providing another stream of income. The company's revenue is significantly influenced by the performance of the hospitality and healthcare markets, occupancy rates, and the quality of its tenant operators. Strategic partnerships with reputable operators also enhance its revenue stability and growth potential.

Service Properties Earnings Call Summary

Earnings Call Date:Nov 05, 2025
(Q3-2025)
|
% Change Since: |
Next Earnings Date:Mar 04, 2026
Earnings Call Sentiment Neutral
The call reflected a mix of strategic progress, particularly in capital market activities and debt management, alongside challenges in the hotel segment due to market headwinds and increased expenses. While there are significant achievements in asset sales and net lease performance, the decline in hotel EBITDA and other disruptions indicate a balanced sentiment.
Q3-2025 Updates
Positive Updates
Successful Capital Market Activities
Raised over $850 million in proceeds, including $295 million from asset sales during the quarter, $67 million in asset sales in October and November, and approximately $490 million from the issuance of new zero-coupon bonds.
Debt Management and Financial Flexibility
Fully repaid the revolving credit facility and retired all 2026 senior notes, improving debt maturity profile and enhancing covenant position.
Hotel Sales Progress
On track to complete the sale of 121 hotels for gross proceeds of $959 million, with 6 hotels sold for $66.5 million in October and 69 more expected to close in November and December for $567.5 million.
Net Lease Segment Performance
Net lease portfolio delivered steady performance with rent growth over 2%, stable rent coverage, and occupancy over 97%.
RevPAR Growth
RevPAR increased 20 basis points year-over-year, outpacing the broader industry by 160 basis points, driven by occupancy gains.
Negative Updates
Decline in Hotel EBITDA
Hotel EBITDA declined 18.9% from the prior year due to softer demand and expense pressures, including elevated labor costs and insurance expenses.
Interest Expense Increase
Interest expense increased by $8.7 million year-over-year.
Travel Market Headwinds
U.S. travel market facing headwinds with uneven demand trends amid economic uncertainty, affecting hotel performance.
Insurance and Fire-Related Disruptions
Significant disruption from fire-related events at two full-service hotels, impacting performance.
Impairment Charges
A $27 million impairment was recorded due to shifting of purchase price allocations among hotel portfolios.
Company Guidance
During the Service Properties Trust Third Quarter 2025 Earnings Conference Call, the company provided guidance that includes adjusted hotel EBITDA, although they did not provide a reconciliation of this non-GAAP measure due to the unavailability of certain required information. The call highlighted a sequential decline in fourth-quarter RevPAR, projected to be between $86 and $89, and adjusted hotel EBITDA anticipated to range from $20 million to $25 million. This guidance reflects seasonal declines and industry headwinds. Additionally, the company has raised over $850 million in proceeds, including $295 million from asset sales, $67 million from sales in October and November, and about $490 million from zero-coupon bonds. The proceeds improved SVC's debt maturity profile by repaying the revolving credit facility and retiring all 2026 senior notes. The company plans to use proceeds from remaining hotel sales, projected to bring in $567.5 million, to repay February 2027 senior unsecured notes.

Service Properties Financial Statement Overview

Summary
Service Properties is facing financial challenges with negative profitability margins and high leverage. The company's declining equity ratio and inconsistent cash flows highlight significant risks. While there are efforts to manage debt, the overall financial health remains precarious, necessitating strategic interventions to stabilize operations and improve financial outcomes.
Income Statement
40
Negative
The income statement shows a concerning trend with negative net income in recent periods and a declining gross profit margin from 33.5% in 2024 to 28.5% TTM (Trailing-Twelve-Months). The revenue growth rate is minimal at 1.7% from 2023 to 2024, with a slight decrease in 2025 TTM. Negative EBIT and Net Profit Margins indicate financial distress, affecting profitability.
Balance Sheet
55
Neutral
The balance sheet reveals high leverage with a debt-to-equity ratio of 7.71 TTM, reflecting significant financial risk. The equity ratio has been declining from 16.7% in 2021 to 10.5% TTM, indicating reduced financial stability. However, the decrease in total liabilities suggests some effort in managing debt, albeit not sufficient to offset overall risks.
Cash Flow
50
Neutral
Cash flow analysis shows inconsistent free cash flow with a drastic decline from 2023 to the TTM period. The operating cash flow to net income ratio indicates challenges in converting income to cash, exacerbated by negative net income. This instability in cash flows raises concerns about liquidity and operational efficiency.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue1.87B1.90B1.87B1.86B1.50B1.27B
Gross Profit431.72M602.96M632.29M622.48M469.19M567.35M
EBITDA218.38M462.63M664.80M588.09M286.05M501.76M
Net Income-277.93M-275.53M-32.78M-132.38M-544.60M-301.47M
Balance Sheet
Total Assets6.98B7.12B7.36B7.49B9.15B8.69B
Cash, Cash Equivalents and Short-Term Investments417.42M143.48M180.12M38.37M944.04M73.33M
Total Debt0.005.71B5.52B5.66B7.14B6.21B
Total Liabilities6.33B6.27B6.13B6.10B7.60B6.58B
Stockholders Equity647.91M851.87M1.23B1.39B1.56B2.10B
Cash Flow
Free Cash Flow28.54M139.39M485.55M293.55M151.23M-152.43M
Operating Cash Flow28.54M139.39M485.55M243.13M49.90M37.60M
Investing Cash Flow-137.04M-222.86M-29.58M397.25M-101.31M-51.81M
Financing Cash Flow131.69M43.02M-303.56M-1.54B907.37M24.40M

Service Properties Technical Analysis

Technical Analysis Sentiment
Negative
Last Price2.00
Price Trends
50DMA
2.51
Negative
100DMA
2.56
Negative
200DMA
2.47
Negative
Market Momentum
MACD
-0.13
Positive
RSI
34.19
Neutral
STOCH
28.60
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SVC, the sentiment is Negative. The current price of 2 is below the 20-day moving average (MA) of 2.22, below the 50-day MA of 2.51, and below the 200-day MA of 2.47, indicating a bearish trend. The MACD of -0.13 indicates Positive momentum. The RSI at 34.19 is Neutral, neither overbought nor oversold. The STOCH value of 28.60 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SVC.

Service Properties Risk Analysis

Service Properties disclosed 59 risk factors in its most recent earnings report. Service Properties reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Service Properties Peers Comparison

Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
65
Neutral
$2.17B12.193.79%4.94%3.15%1.96%
62
Neutral
$644.39M0.16%6.23%-1.20%-328.23%
55
Neutral
$178.05M-1.09%7.35%-2.84%-11.88%
54
Neutral
$311.96M579.281.13%5.14%-3.79%
47
Neutral
$344.58M-35.25%2.00%-0.56%-14.18%
47
Neutral
$44.50M-6.543.37%1.78%-33.00%
41
Neutral
$27.41M-7.89%-833.99%
* Real Estate Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
SVC
Service Properties
2.00
-1.06
-34.64%
INN
Summit Hotel Properties
5.58
-0.58
-9.42%
CLDT
Chatham Lodging
6.62
-2.19
-24.86%
AHT
Ashford Hospitality
4.41
-4.62
-51.16%
BHR
Braemar Hotels & Resorts
2.72
-0.48
-15.00%
SOHO
Sotherly Hotels
2.15
0.93
76.23%

Service Properties Corporate Events

Business Operations and StrategyM&A Transactions
Service Properties Sells Three Hotels for $29 Million
Neutral
Nov 4, 2025

On October 29, 2025, Service Properties Trust (SVC) sold three hotels totaling 390 keys for $29.0 million as part of a larger agreement to sell 113 hotels. To date, SVC has sold 44 hotels for $345.8 million and plans to sell the remaining 69 hotels by the end of 2025. The proceeds from these sales are expected to be used to repay debt, impacting SVC’s financial strategy and potentially improving its debt position.

The most recent analyst rating on (SVC) stock is a Hold with a $2.00 price target. To see the full list of analyst forecasts on Service Properties stock, see the SVC Stock Forecast page.

Business Operations and StrategyM&A Transactions
Service Properties Sells California Hotel for $27.5M
Neutral
Oct 28, 2025

On October 22, 2025, Service Properties Trust (SVC) sold a hotel in California for $27.5 million as part of a larger agreement to sell 113 hotels for a total of $913.3 million. To date, SVC has sold 41 hotels for $316.8 million and plans to sell the remaining 72 hotels by the end of 2025. The proceeds from these sales are expected to be used to repay debt. The sales of 15 hotels in the 45 Hotel Sale Portfolio have been significant enough to require pro forma financial information, reflecting the company’s financial position as of June 30, 2025.

The most recent analyst rating on (SVC) stock is a Hold with a $2.00 price target. To see the full list of analyst forecasts on Service Properties stock, see the SVC Stock Forecast page.

Business Operations and StrategyM&A Transactions
Service Properties Sells Two Hotels for $10 Million
Neutral
Oct 21, 2025

Service Properties Trust (SVC) announced the sale of two hotels, totaling 235 keys, for $10 million on October 15, 2025, as part of a larger agreement to sell 113 hotels for $913.3 million. To date, SVC has sold 40 hotels, generating $289.3 million, and plans to complete the sale of the remaining 73 hotels by the end of 2025. The proceeds from these sales are intended to repay debt, which could impact the company’s financial stability and market position.

The most recent analyst rating on (SVC) stock is a Hold with a $2.50 price target. To see the full list of analyst forecasts on Service Properties stock, see the SVC Stock Forecast page.

Business Operations and StrategyM&A Transactions
Service Properties Sells Five Hotels for $50 Million
Neutral
Oct 6, 2025

On September 30, 2025, Service Properties Trust (SVC) sold five hotels with a total of 640 keys for $50 million as part of a larger agreement to sell 113 hotels. To date, SVC has sold 38 hotels for $279.3 million and plans to complete the sale of the remaining 75 hotels by the end of 2025, using the proceeds to repay debt.

The most recent analyst rating on (SVC) stock is a Hold with a $2.50 price target. To see the full list of analyst forecasts on Service Properties stock, see the SVC Stock Forecast page.

Business Operations and StrategyM&A Transactions
Service Properties Sells Three Hotels for $22.5 Million
Neutral
Sep 29, 2025

On September 23, 2025, Service Properties sold three hotels with a total of 399 keys across three states for $22.5 million, as part of a larger agreement to sell 113 hotels. To date, the company has sold 23 hotels for $158.2 million and plans to sell the remaining 90 hotels by the end of 2025, using the proceeds to repay debt.

The most recent analyst rating on (SVC) stock is a Hold with a $3.00 price target. To see the full list of analyst forecasts on Service Properties stock, see the SVC Stock Forecast page.

Business Operations and StrategyM&A Transactions
Service Properties Sells Hotels to Repay Debt
Neutral
Sep 25, 2025

On September 18, 2025, Service Properties Trust (SVC) sold three hotels with a total of 413 keys for $26.5 million and eight hotels with 1,041 keys for $20.3 million as part of a larger plan to sell 113 hotels for $913.3 million. To date, SVC has sold 20 hotels for $135.7 million and plans to sell the remaining 93 hotels by the end of 2025. The proceeds from these sales are intended to repay debt, including outstanding borrowings under its revolving credit facility.

The most recent analyst rating on (SVC) stock is a Hold with a $2.50 price target. To see the full list of analyst forecasts on Service Properties stock, see the SVC Stock Forecast page.

Private Placements and Financing
Service Properties Completes $490M Private Offering
Neutral
Sep 25, 2025

On September 23, 2025, Service Properties completed a private offering of zero coupon senior secured notes due 2027, raising approximately $490 million in net proceeds. The company plans to use these funds to redeem its outstanding 4.750% senior notes due 2026 and reduce its revolving credit facility. The notes are secured by first-priority liens on the equity interests of certain subsidiaries and are subject to restrictive covenants. The redemption of the 2026 notes is expected to occur on October 16, 2025.

The most recent analyst rating on (SVC) stock is a Hold with a $2.50 price target. To see the full list of analyst forecasts on Service Properties stock, see the SVC Stock Forecast page.

Business Operations and StrategyM&A Transactions
Service Properties Sells Two Hotels for $25M
Neutral
Sep 18, 2025

On September 16, 2025, Service Properties sold two hotels with a total of 318 keys for $25.0 million as part of a larger agreement to sell 113 hotels. To date, nine hotels have been sold for $88.9 million, with 104 hotels remaining to be sold by the end of 2025. The proceeds from these sales are intended to repay debt, including outstanding borrowings under its revolving credit facility.

The most recent analyst rating on (SVC) stock is a Hold with a $2.50 price target. To see the full list of analyst forecasts on Service Properties stock, see the SVC Stock Forecast page.

Business Operations and StrategyM&A Transactions
Service Properties Sells Five Hotels for $44.9 Million
Neutral
Sep 11, 2025

On September 9, 2025, Service Properties Trust (SVC) sold five hotels with a total of 690 keys for $44.9 million as part of a larger agreement to sell 114 hotels. To date, seven hotels have been sold for $63.9 million, with 106 hotels remaining under agreement to be sold by the end of 2025. SVC plans to use the proceeds to repay debt and is exploring additional property sales and refinancing options to address its financial needs.

The most recent analyst rating on (SVC) stock is a Hold with a $2.50 price target. To see the full list of analyst forecasts on Service Properties stock, see the SVC Stock Forecast page.

Business Operations and StrategyM&A Transactions
Service Properties Signs New Agreement with Sonesta
Neutral
Sep 2, 2025

Service Properties entered into a new management agreement with Sonesta International Hotels Corporation for 59 hotels effective August 1, 2025. The agreement includes a 15-year term with renewal options, various fees, and conditions for termination. Additionally, Service Properties has sold 10 hotels and is in the process of selling 111 more, with Sonesta waiving termination fees for these sales.

The most recent analyst rating on (SVC) stock is a Hold with a $2.50 price target. To see the full list of analyst forecasts on Service Properties stock, see the SVC Stock Forecast page.

Service Properties Trust’s Earnings Call Highlights Mixed Results
Aug 8, 2025

Service Properties Trust’s recent earnings call revealed a mixed performance, highlighting both strategic achievements and pressing challenges. The company reported significant progress in hotel dispositions and positive trends in Revenue per Available Room (RevPAR), yet faced hurdles such as increased interest expenses, declining EBITDA, and issues with debt covenants.

Service Properties Trust’s Strategic Shift Heightens Economic Vulnerability
Aug 7, 2025

Service Properties Trust faces increased business risk due to its strategic shift towards service-focused retail net lease properties, particularly in the travel center sector, following the sale of its hotel assets. This concentration makes the company more susceptible to fluctuations in the U.S. economy, as a slowdown could diminish leasing demand and subsequently decrease the value of its common shares. The lack of diversification across property types, such as residential or office spaces, amplifies the potential adverse effects of economic downturns on its financial performance. Consequently, investors should be cautious of the heightened vulnerability to cyclical economic conditions impacting service-focused retail properties.

Service Properties Trust Reports Q2 2025 Results
Aug 7, 2025

Service Properties Trust (SVC) is a real estate investment trust specializing in hotels and service-focused retail net lease properties, with a significant presence in the United States, Puerto Rico, and Canada. The company is managed by The RMR Group, a prominent asset management firm.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Nov 06, 2025