Apple Hospitality REIT Receives a Hold from FBR Capital

By Jason Carr

FBR Capital analyst Bryan Maher reiterated a Hold rating on Apple Hospitality REIT (NYSE: APLE) yesterday and set a price target of $20. The company’s shares closed yesterday at $17.62.

Maher commented:

“Apple Hospitality REIT posted a modest 3Q16 earnings miss driven mainly by its exposure to three somewhat challenged MSAs. Despite its broad reach across 96 MSAs (236 hotels at September 30), three in particular—Houston, Chicago and Austin—weighed on RevPAR by a combined ~110 bps, resulting in system-wide RevPAR of 1.8% (total U.S. industry was 3.3% in 3Q16). The REIT also faced storm- related impacts (~30 bps) in the southeastern U.S. These results were in contrast to 2Q16 when Apple’s results (+5.1% RevPAR) handily outpaced the U.S. In addition to these headwinds, Apple REIT was busy in 3Q16 completing/integrating its $1.3 billion acquisition of Apple REIT Ten (56 hotels, 7,209 rooms). We suspect there could have been some modest disruption here, as well, although this is not readily quantifiable. Adjusted EBITDA came in at $104.1 million, about 3.4% below our estimate. Management reaffirmed its full-year outlook of 2%–4% RevPAR growth and adjusted EBITDA of $370 million to $390 million—consistent with our estimates.”

According to TipRanks.com, Maher is a 1-star analyst with an average return of -3.2% and a 42.1% success rate. Maher covers the Financial sector, focusing on stocks such as Government Properties Income Trust, Retail Opportunity Investments, and Ashford Hospitality Trust.

Apple Hospitality REIT has an analyst consensus of Hold.

The company has a one year high of $20.97 and a one year low of $16.35. Currently, Apple Hospitality REIT has an average volume of 926.2K.

Based on the recent corporate insider activity of 42 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of APLE in relation to earlier this year. Most recently, in September 2016, Redd Hugh, a Director at APLE bought 1,000 shares for a total of $18,300.

Apple Hospitality REIT, Inc., a real estate investment trust, invests in hotels and other income-producing real estate companies located in the US.