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AMERICAN HOTEL (TSE:HOT.UN)
TSX:HOT.UN
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AMERICAN HOTEL
(TSX:HOT.UN)
Rating:48Neutral
Price Target:
C$0.50
▲(8.70%Upside)
AMERICAN HOTEL (HOT.UN) vs. iShares MSCI Canada ETF (EWC)
Market Cap
$35.47M
Dividend Yield4.24%
Average Volume (3M)40.06K
Price to Earnings (P/E)―
Beta (1Y)1.17
Revenue Growth-12.67%
EPS Growth25.05%
CountryCA
Employees11
SectorReal Estate
Sector Strength55
IndustryREIT - Hotel & Motel
Share Statistics
EPS (TTM)N/A
Shares Outstanding77,958,180
10 Day Avg. Volume18,334
30 Day Avg. Volume40,060
Financial Highlights & Ratios
PEG Ratio-0.02
Price to Book (P/B)0.58
Price to Sales (P/S)0.00
P/FCF Ratio9.70
Enterprise Value/Market Cap33.04
Enterprise Value/Revenue1.08
Enterprise Value/Gross Profit18.12
Enterprise Value/Ebitda5.44
Forecast
1Y Price Target
$0.70Price Target Upside52.00% Upside
Rating ConsensusHold
Number of Analyst Covering1
AMERICAN HOTEL Business Overview & Revenue Model
Company DescriptionAmerican Hotel Income Properties REIT LP (TSX: HOT.UN, TSX: HOT.U, TSX: HOT.DB.U), or AHIP, is a limited partnership formed to invest in hotel real estate properties across the United States. AHIP's 78 premium branded, select-service hotels are located in secondary metropolitan markets that benefit from diverse and stable demand. AHIP hotels operate under brands affiliated with Marriott, Hilton, IHG and Choice Hotels through license agreements. The Company's long-term objectives are to build on its proven track record of successful investment, deliver monthly U.S. dollar denominated distributions to unitholders, and generate value through the continued growth of its diversified hotel portfolio.
How the Company Makes MoneyAmerican Hotel Income Properties REIT LP makes money primarily through the ownership and operation of its portfolio of hotel properties. The company's revenue model is centered on generating income from room bookings, food and beverage sales, and other hotel services offered to guests. Key revenue streams include room rental income, which is influenced by occupancy rates and average daily rates, and ancillary services such as conference hosting and catering. The company also benefits from strategic partnerships with major hotel brands, which enhance its properties' marketability and operational efficiency. Additionally, American Hotel Income Properties REIT LP may engage in property sales or refinancing to optimize its portfolio and generate additional income.
AMERICAN HOTEL Earnings Call Summary
Earnings Call Date:May 14, 2025
(Q1-2025)
| % Change Since: -13.21%|
Next Earnings Date:Aug 12, 2025
Earnings Call Sentiment Neutral
While AHIP showed positive revenue growth and successful execution of its disposition program, financial metrics such as NOI margin and FFO displayed weaknesses. Debt refinancing achievements were notable, yet increased expenses and reduced cash reserves present ongoing challenges.Q1-2025 Updates
Positive Updates
Revenue Growth
Total revenue grew by 1.2% with RevPAR finishing at $93, a 2.4% improvement over Q1 2024, driven by increased occupancy in extended stay and select service properties.
Successful Disposition Program
Completed the disposition of 3 hotel properties for total gross proceeds of $41.2 million and have 9 more properties under purchase and sales agreements for estimated total gross proceeds of $49.7 million.
Debt Refinancing Achievements
Completed 2 refinancings for total gross proceeds of $144.3 million, resulting in the full repayment of the senior credit facility and no further debt maturities until the fourth quarter of 2026.
Stability in Labor Costs
Wages, turnover, and productivity have stabilized with dependency on contract labor tapering off.
Negative Updates
NOI Margin Decline
NOI margin decreased by 107 basis points to 27.5%, impacted by higher operating expenses due to general cost inflation.
Negative FFO
Normalized diluted funds from operations (FFO) was negative $0.02 per unit for the quarter, compared to $0.02 per unit in Q1 2024.
Reduced Cash Balance
Unrestricted cash balance decreased from $27.9 million at the end of 2024 to $17.8 million at the end of March 2025.
Increased Undistributed Expenses
Undistributed expenses, particularly labor, remain elevated, alongside significant increases in utility expenses and repairs.
Company Guidance
During American Hotel Income Properties REIT LP's first quarter call for fiscal year 2025, CEO Jonathan Korol reported a 1.2% increase in total revenue and a RevPAR of $93, marking a 2.4% improvement from Q1 2024. However, the NOI margin declined by 107 basis points to 27.5% due to increased operating expenses and occupancy-driven RevPAR growth. The company's disposition program resulted in the sale of three hotel properties for $41.2 million, with nine more properties under purchase agreements expected to yield $49.7 million. AHIP completed two refinancings totaling $144.3 million, which enabled full repayment of their senior credit facility. Despite a negative FFO of $0.02 per unit, AHIP has no debt maturities until Q4 2026 and plans to address future obligations by raising capital through potential further hotel sales and recapitalization efforts over the next 12 to 18 months.AMERICAN HOTEL Financial Statement Overview
Summary
AMERICAN HOTEL faces challenges with declining revenue and a high debt burden impacting its financial flexibility. While the EBIT margin is positive, persistent net losses and negative shareholder returns indicate a strained financial position. Cash flow from operations remains positive, but high leverage and declining revenue are concerning.Income Statement
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.52
Neutral
Balance Sheet
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.45
Neutral
Cash Flow
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.58
Neutral
| Breakdown | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 256.88M | 280.52M | 281.37M | 241.31M | 174.85M |
| Gross Profit | 73.42M | 83.37M | 40.33M | 45.83M | 3.33M |
| EBITDA | 32.48M | -7.13M | 37.12M | 81.91M | 8.07M |
| Net Income | -46.98M | -81.49M | -39.64M | -15.61M | -66.43M |
Balance Sheet | |||||
| Total Assets | 685.11M | 954.89M | 1.05B | 1.15B | 1.19B |
| Cash, Cash Equivalents and Short-Term Investments | 27.84M | 17.80M | 12.95M | 14.70M | 20.15M |
| Total Debt | 431.63M | 645.66M | 688.44M | 738.85M | 782.31M |
| 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 | 29.70M | 44.91M | 17.95M | 3.55M |
| Investing Cash Flow | 155.19M | 2.69M | 15.30M | -18.63M | -1.96M |
| Financing Cash Flow | -155.85M | -28.63M | -61.96M | -4.34M | 932.00K |
AMERICAN HOTEL Technical Analysis
Negative
0.46
Price Trends
0.49
Negative
0.54
Negative
0.58
Negative
Market Momentum
>-0.01
Negative
46.11
Neutral
33.33
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 0.46 is above the 20-day moving average (MA) of 0.46, below the 50-day MA of 0.49, and below the 200-day MA of 0.58, indicating a bearish trend. The MACD of >-0.01 indicates Negative momentum. The RSI at 46.11 is Neutral, neither overbought nor oversold. The STOCH value of 33.33 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 (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
59 Neutral | C$1.23B | 0.76 | -8.20% | 5.62% | 9.89% | -25.14% | |
56 Neutral | $71.17M | ― | -16.65% | 0.73% | -2.12% | -287.56% | |
53 Neutral | C$30.05M | ― | -162.05% | 1.79% | 0.66% | -178.71% | |
50 Neutral | C$30.91M | ― | -25.21% | 7.55% | -22.78% | -19.14% | |
48 Neutral | $35.47M | ― | -53.87% | 4.24% | -12.67% | 25.05% | |
37 Underperform | C$47.13M | ― | -5.93% | 1.95% | -2.06% | 43.41% | |
| C$35.74M | ― | -4.25% | ― | ― | ― |
* Real Estate Sector Average
Performance Comparison
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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.