AMERICAN HOTEL (HOT.UN) AI Stock Analysis

129 Followers

Top Page

AMERICAN HOTEL

(OTC:HOT.UN)

48Neutral

AMERICAN HOTEL is facing significant financial challenges, with declining revenue, high leverage, and negative profitability. Technical indicators suggest a bearish trend, while valuation metrics are weak due to ongoing losses. Despite some positive aspects from strategic initiatives and revenue growth, persistent operational issues and margin pressures weigh heavily on the stock's outlook.

AMERICAN HOTEL (HOT.UN) vs. S&P 500 (SPY)

Market Cap

C$41.38M

Dividend Yield4.24%

Average Volume (3M)54.29K

Price to Earnings (P/E)―

Beta (1Y)1.12

Revenue Growth-7.15%

EPS Growth38.95%

CountryCA

Employees10

SectorReal Estate

Sector Strength82

IndustryREIT - Hotel & Motel

Share Statistics

EPS (TTM)-0.82

Shares Outstanding78,072,690

10 Day Avg. Volume85,438

30 Day Avg. Volume54,290

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.10

Price to Cash Flow (P/CF)1.20

P/FCF Ratio0.20

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

C$0.71

Price Target Upside33.19% Upside

Rating ConsensusHold

Number of Analyst Covering1

AMERICAN HOTEL Business Overview & Revenue Model

Company DescriptionAmerican Hotel Income Properties REIT LP (HOT.UN) is a real estate investment trust focused on the acquisition and operation of hotel properties across the United States. The company's portfolio primarily consists of premium branded, select-service hotels, which are often located near transportation hubs, such as airports and major highways. American Hotel aims to provide investors with stable, tax-efficient distributions and value growth through active asset management and strategic acquisitions.

How the Company Makes MoneyAmerican Hotel Income Properties REIT LP makes money primarily through the ownership and operation of its hotel properties. The company generates revenue by leasing rooms to guests, providing hospitality services, and offering amenities such as food and beverage sales. Revenue streams are enhanced by maintaining affiliations with well-known hotel brands, which attract a steady flow of customers. Additionally, American Hotel may earn income from ancillary services provided at its properties, and the company actively manages its portfolio to optimize occupancy rates and room pricing. Strategic partnerships with hotel management companies also play a role in maximizing operational efficiency and profitability.

AMERICAN HOTEL Financial Statement Overview

Summary

AMERICAN HOTEL faces challenges with declining revenue and a high debt burden impacting its financial flexibility. The company shows some operational stability with a positive EBIT margin but struggles with persistent net losses. Cash flow from operations remains positive, providing some liquidity support, yet the overall financial position is strained by high leverage and negative shareholder returns.

Income Statement

Neutral

The company showed declining revenue with a growth rate of -8.43% between 2023 and 2024. The gross profit margin decreased to 28.57% in 2024 from 29.72% in 2023, indicating pressure on profitability. The net profit margin remains negative, at -18.29% in 2024, showing significant net losses, although improved from -27.79% in 2023. The EBIT margin improved to 17.08% in 2024 from 17.26% in 2023, showing some stability in operational earnings.

Balance Sheet

Neutral

The debt-to-equity ratio is high at 3.11 in 2024, indicating significant leverage and potential financial risk. Stockholders' equity declined, reducing the equity ratio to 20.28% in 2024 from 19.83% in 2023, reflecting limited equity support and increased financial vulnerability. Return on equity remains negative due to continued net losses, highlighting ongoing challenges in generating shareholder returns.

Cash Flow

Neutral

Free cash flow improved slightly to $631K in 2024 from $5.56M in 2023. The operating cash flow to net income ratio is positive, indicating that operations are generating cash even amidst net losses. However, the free cash flow to net income ratio is low, reflecting limited free cash flow relative to the net loss.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
256.88M	280.52M	281.37M	241.31M	174.85M
	Gross Profit
73.42M	83.37M	51.20M	45.83M	3.16M
	EBIT
43.88M	48.42M	33.17M	45.83M	-16.03M
	EBITDA
32.48M	-3.61M	71.13M	69.05M	27.39M
	Net Income Common Stockholders
-46.98M	-77.97M	-35.11M	-11.85M	-65.77M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
27.84M	17.80M	12.95M	14.70M	20.15M
	Total Assets
685.11M	954.89M	1.05B	1.15B	1.19B
	Total Debt
431.63M	645.66M	688.44M	738.85M	782.31M
	Net Debt
403.78M	627.87M	675.49M	724.15M	762.16M
	Total Liabilities
501.09M	721.94M	730.69M	775.89M	852.19M
	Stockholders Equity
138.92M	189.38M	278.54M	331.03M	341.71M
Cash Flow		Free Cash Flow
631.00K	5.56M	16.66M	11.74M	-5.39M
	Operating Cash Flow
10.70M	30.85M	44.91M	17.95M	3.55M
	Investing Cash Flow
155.19M	2.64M	15.30M	-18.63M	-1.96M
	Financing Cash Flow
-155.85M	-28.63M	-61.96M	-4.34M	932.00K

AMERICAN HOTEL Technical Analysis

Technical Analysis Sentiment

Negative

Last Price0.53

Price Trends

50DMA

0.59

Negative

100DMA

0.59

Negative

200DMA

0.57

Negative

Market Momentum

MACD

-0.01

Negative

RSI

48.75

Neutral

STOCH

79.96

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:HOT.UN, the sentiment is Negative. The current price of 0.53 is above the 20-day moving average (MA) of 0.52, below the 50-day MA of 0.59, and below the 200-day MA of 0.57, indicating a neutral trend. The MACD of -0.01 indicates Negative momentum. The RSI at 48.75 is Neutral, neither overbought nor oversold. The STOCH value of 79.96 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:HOT.UN.

AMERICAN HOTEL Peers Comparison

Overall Rating

UnderperformOutperform

Sector (60)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SRU.UN	76 Outperform	C$4.25B	18.77	4.50%	7.38%	9.46%	-42.77%
FCR.UN	73 Outperform	C$3.44B	16.76	5.20%	5.38%	6.55%	―
CAR.UN	72 Outperform	C$6.54B	23.25	3.20%	3.69%	4.45%	―
HR.UN	63 Neutral	C$2.58B	―	-2.29%	6.34%	-6.92%	-296.31%
Sector *	60 Neutral	$3.00B	12.40	0.61%	9872.56%	7.62%	-2.59%
AP.UN	58 Neutral	$2.10B	―	-5.79%	11.81%	4.98%	19.54%
HOT.UN	48 Neutral	C$41.38M	―	-53.87%	4.24%	-7.15%	38.95%

* Real Estate Sector Average

Performance Comparison

TSE:HOT.UN

AMERICAN HOTEL

0.55

0.03

5.77%

TSE:AP.UN

Allied Properties Real Estate Investment Trust

15.38

0.06

0.37%

TSE:FCR.UN

First Capital Realty

16.49

2.57

18.46%

TSE:SRU.UN

SmartCentres Real Estate Investment Trust

25.47

5.00

24.43%

TSE:HR.UN

H&R Real Estate ate Staple

9.83

1.46

17.44%

TSE:CAR.UN

Canadian Apartment

40.74

-0.20

-0.49%

AMERICAN HOTEL Earnings Call Summary

Earnings Call Date: Apr 1, 2025 | % Change Since: -8.62% | Next Earnings Date: May 13, 2025

Earnings Call Sentiment Neutral

The earnings call reflects a mixed performance with notable achievements in revenue growth, successful property dispositions, and refinancing efforts. However, challenges persist in the form of margin pressures, operational difficulties, and certain segment declines. While certain strategic initiatives have bolstered financial stability, consistent operational issues and margin decreases present ongoing concerns.

Highlights

Strong Revenue Growth

Total revenue grew by 5% for the year and RevPAR increased by 4.5% compared to fiscal year 2023, driven by occupancy and ADR growth.

Successful Disposition Program

Completed the disposition of 16 properties with total gross proceeds of $165.2 million, representing a blended cap rate of 7% on 2023 annual hotel EBITDA.

Debt Reduction Achievements

Reduced debt to gross book value by 610 basis points and debt to trailing 12 months EBITDA by around 2.5 turns during 2024.

Refinancing Success

Completed refinancing for total gross proceeds of $144.3 million, resulting in the full repayment of the senior credit facility.

Extended Stay Vertical Performance

Extended Stay vertical saw RevPAR growth of 8% over fiscal year 2023, being the strongest performing segment in the portfolio.

Lowlights

Margin Pressures

NOI margin decreased by 45 basis points to 30.6% for the year, affected by high labor and operating costs.

Embassy Suites Segment Decline

The Embassy Suites segment saw a RevPAR decline of 3% year-over-year, down to $103.

Operational Challenges

High employee turnover, inconsistent operating performance at the asset level, and elevated undistributed expenses negatively impacted the bottom line.

Restatement and Delay in Results

Delay in releasing year-end results and restatement of prior periods due to deconsolidation of certain subsidiaries.

Issues with Franchise Standards

Technical defaults identified during regular QA audits, mainly relating to operational and labor issues.

Company Guidance

During the American Hotel Income Properties REIT LP's fourth-quarter conference call for the fiscal year 2024, several key metrics were discussed, reflecting the company's financial performance and strategic initiatives. AHIP reported a 5% increase in total revenue for the year, with a RevPAR of $98, marking a 4.5% improvement over 2023. Despite facing high labor and operational costs that led to a 45-basis-point decline in NOI margin to 30.6% for the year, the company is actively working on cost control measures. AHIP successfully disposed of 16 properties for $165.2 million, with a blended cap rate of 7% on 2023 annual hotel EBITDA, and plans to use the proceeds to reduce debt, achieving a 610-basis-point decrease in debt to gross book value and a 2.5-turn reduction in debt to EBITDA. The company's portfolio of 49 hotels achieved a RevPAR index of 116.1, with Extended Stay and Select Service segments driving growth. Additionally, AHIP completed refinancing activities, securing total gross proceeds of $144.3 million, which helped repay its senior credit facility and improve financial stability.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.