2025 has been a challenging year for the U.S. economy, with unemployment increasing to 4.6% in November and the longest-lasting government shutdown sapping economic momentum in the final quarter of the year. ThisI ventured into investing in high school in 2011, mainly in REITs, preferred stocks, and high-yield bonds, starting a fascination with markets and the economy that has not faded despite the years. More recently I have been combining long stock positions with covered calls and cash secured puts. I ap ...

2025 has been a challenging year for the U.S. economy, with unemployment increasing to 4.6% in November and the longest-lasting government shutdown sapping economic momentum in the final quarter of the year. ThisI ventured into investing in high school in 2011, mainly in REITs, preferred stocks, and high-yield bonds, starting a fascination with markets and the economy that has not faded despite the years. More recently I have been combining long stock positions with covered calls and cash secured puts. I ap ...

Kairoi Residential purchased a prominent corner in LoHi for $39 million Friday. The San Antonio, Texas-based apartment developer paid $231 a square foot for the 4 acres under the Residence Inn by Marriott hotel at 2777 Zuni St., public records show. Kairoi plans to build a 5-story, 429-unit apartment complex near the Speer Boulevard and Zuni Street intersection. The company submitted documents to Denver in July estimating the planned construction cost at $65.6 million.Kairoi did not respond to a request for ...

Group 1 - U.S. stock futures were mostly higher, with Nasdaq futures gaining around 100 points [1] - Domo Inc reported quarterly earnings of 1 cent per share, beating the analyst consensus estimate of a loss of 5 cents per share [2] - Domo's quarterly sales were $79.400 million, exceeding the analyst consensus estimate of $78.967 million [2] Group 2 - Domo shares fell 14.2% to $9.93 in pre-market trading following the earnings report and weak fourth-quarter sales guidance [2] - Sportsman's Warehouse Holdings Inc tumbled 18.8% to $1.99 in pre-market trading after reporting third-quarter results [4] - Argan Inc fell 11.6% to $315.00 in pre-market trading due to worse-than-expected third-quarter sales results [4] - Hewlett Packard Enterprise Co shares dipped 9.2% to $20.80 after mixed fourth-quarter financial results and weak first-quarter sales guidance [4] - SentinelOne Inc declined 8% to $15.61 after narrowing its FY26 sales guidance below estimates [4] - SoFi Technologies Inc fell 7.5% to $27.39 as the company announced pricing of a public offering of common stock [4] - Oklo Inc fell 6.6% to $104.30 after entering into an equity distribution agreement to offer up to $1.5 billion of common stock [4] - Docusign Inc fell 5.5% to $67.21 following third-quarter results [4] - Parsons Corp fell 5.3% to $80.00 in pre-market trading [4] - Chatham Lodging Trust fell 4.3% to $6.24 in pre-market trading [4]

Revenue Performance - Total revenue for the three months ended September 30, 2025, was $78.4 million, a decrease of 10.1% compared to $87.2 million for the same period in 2024[118] - Total revenue for the nine months ended September 30, 2025, was $227.3 million, a decrease of $14.8 million or 6.1% compared to $242.1 million for the same period in 2024[137] - Five hotels were sold during the reporting period, contributing zero revenue in 2025, which impacted overall revenue figures[117] Room Revenue - Room revenue comprised 91.7% of total revenue for the three months ended September 30, 2025, down from 92.0% in 2024[118] - Room revenue comprised 91.4% of total revenue for the nine months ended September 30, 2025, down from 91.6% in 2024[138] Operating Expenses - Hotel operating expenses decreased by $4.2 million, or 8.7%, to $44.0 million for the three months ended September 30, 2025, from $48.2 million in 2024[124] - Hotel operating expenses decreased by $7.9 million, or 5.7%, to $128.8 million for the nine months ended September 30, 2025, from $136.7 million in 2024[144] - Total property taxes, ground rent, and insurance expenses decreased from $6.5 million in 2024 to $5.3 million in 2025, attributed to hotel sales and successful property tax appeals[128] Net Income - Net income for the three months ended September 30, 2025, was $3.6 million, compared to $4.3 million for the same period in 2024, reflecting a decrease of 16.3%[135] - Net income for the nine months ended September 30, 2025, was $10.6 million, an increase of 79.7% compared to $5.9 million for the same period in 2024[156] Debt and Leverage - The leverage ratio as of September 30, 2025, was 20.6%, with total debt of $343.2 million at a weighted-average interest rate of approximately 6.29%[111] - Total debt principal and interest obligations amounted to $455.9 million as of September 30, 2025, with $21.6 million payable within the next 12 months[180] - The leverage ratio was approximately 20.6% as of September 30, 2025, with total debt of $343.2 million at an average interest rate of 6.29%[181] Interest Expense - Interest expense decreased by $3.8 million, or 16.2%, from $23.3 million for the nine months ended September 30, 2024, to $19.5 million for the same period in 2025[153] - Interest on cash and cash equivalents and other income decreased from $1.6 million for the nine months ended September 30, 2024, to $0.2 million in 2025, a decline of 87.5%[152] Cash Flow - Net cash flows provided by operating activities decreased by $9.1 million to $51.8 million for the nine months ended September 30, 2025, compared to $60.9 million in 2024[175] - Net cash flows provided by investing activities increased by $84.5 million to $32.4 million during the nine months ended September 30, 2025, compared to $(52.1) million in 2024[176] Asset Management - The company intends to acquire quality assets at attractive prices while remaining prudently leveraged, utilizing various funding sources[110] - The company expects to invest approximately $5.7 million on renovations and improvements for existing hotels during the remainder of 2025[177] - The company sold six hotels and acquired one hotel during the nine months ended September 30, 2025, impacting revenue and operating expenses significantly[136] Tax and Valuation - Income tax expense remained unchanged at zero for the nine months ended September 30, 2025, and 2024, due to cumulative three-year taxable losses[155] - The company continues to recognize a full valuation allowance equal to 100% of the gross deferred tax assets due to uncertainty in utilizing these assets[155] Market Conditions - The U.S. lodging industry RevPAR decreased by 1.4% for the three months ended September 30, 2025, indicating a slowdown in industry performance[116] - Same property RevPAR decreased 2.5% for the three months ended September 30, 2025, driven by a 0.6% decrease in occupancy and a 1.8% decrease in ADR[123] - Same property RevPAR increased by 0.2% for the nine months ended September 30, 2025, driven by a 1.0% increase in occupancy[142] Shareholder Returns - The company declared total dividends of $0.27 per common share for the nine months ended September 30, 2025, compared to $0.21 in 2024[179] - During the nine months ended September 30, 2025, the company repurchased 275,693 common shares at a weighted-average price of $7.17, totaling approximately $2.0 million[186] - As of September 30, 2025, there was approximately $49.9 million in common shares available for issuance under the Dividend Reinvestment and Stock Purchase Plan[184] Financial Estimates and Risks - Management estimates and assumptions in financial statements are based on reasonable circumstances, but actual results could differ from these estimates[195] - The company aims to limit the impact of interest rate changes on earnings and cash flows by primarily borrowing at fixed rates or the lowest variable rates available[197] - Inflation may affect the company's expenses and costs of capital investments, including construction, labor, and materials[193] - The company evaluates its estimates and judgments on an ongoing basis, with significant accounting policies disclosed in the Annual Report[195] - The company may utilize cash on hand or borrowings to cover expenses during quarters with insufficient cash flow from operations due to seasonal fluctuations[194]

Financial Data and Key Metrics Changes - The company reported Q3 2025 hotel EBITDA of $28.8 million and adjusted EBITDA of $26.2 million, with adjusted FFO of $0.32 per share [22] - The GOP margin for the quarter was 43.6%, down 90 basis points from Q3 2024, reflecting strong expense control despite a challenging rent-par environment [22] - Year-over-year increase in labor and benefits cost per occupied room was held to 1.7% [22] Business Line Data and Key Metrics Changes - Rent-par performance in Silicon Valley showed mixed results, with Mountain View and San Mateo hotels growing by 2.5%, while Sunnyvale hotels fell by 9% [9] - Coastal Northeast and Greater New York markets experienced RevPAR growth of 2% and 8%, respectively, with the Hampton Inn Portland achieving an all-time record high for quarterly RevPAR [10] - The six predominantly leisure hotels produced rent-par growth of 3%, with SpringHill Suites Savannah seeing over 30% growth post-renovation [12] Market Data and Key Metrics Changes - The company noted that vehicle border crossings from Canada were down approximately 35% in Q3 compared to last year, impacting hotel performance in certain regions [17] - The three Washington, D.C. hotels experienced significant volatility, with rent-par down 19% in October due to the government shutdown [16] - Overall, the supply growth in the market is projected to remain below 1% for the next year, which is favorable for lodging [43] Company Strategy and Development Direction - The company completed the sale of five older hotels to enhance liquidity for future investments and plans to remain active in share repurchases, believing the stock is undervalued [5][6] - The company is optimistic about external growth opportunities, with deal flow underwriting steady and seller pricing expectations becoming more reasonable [6] - Development plans include the Home2 Suites in Portland, Maine, with site work expected to start in 2026 and a projected opening in early 2028 [30] Management Comments on Operating Environment and Future Outlook - Management acknowledged the volatility in operating fundamentals and the impact of external factors like government shutdowns and travel spending halts on performance [13] - The outlook for lodging dynamics is favorable, with expectations for capital investments and limited supply growth to support rent-par and margin expansion in the coming years [13] - Management expressed confidence in the long-term health of the markets, particularly in the Central and Southeastern U.S. [7] Other Important Information - The company repurchased approximately 500,000 shares, with plans to continue active repurchases [5][23] - Capital expenditures for the quarter were approximately $4 million, with ongoing renovations planned for two hotels [21] - The common dividend was increased by almost 30% earlier in the year, currently at 9 cents per share per quarter [21] Q&A Session Summary Question: Investment opportunities in the acquisition market - Management indicated that the current market presents opportunities due to negative rent-par trends, with cap rates now above 8% [26] Question: Timing of the Portland Maine development - Site work for the Portland development is expected to start in 2026, with a construction timeline of 21-24 months [30] Question: Factors driving rent-par performance variance - The decline was primarily due to the performance of the Sunnyvale hotels and the impact of the government shutdown on D.C. hotels [36] Question: Outlook for convention business in 2026 - The convention calendar in Austin and Dallas is expected to remain stable until 2027, with supply growth projected to be less than 1% [42] Question: Capital allocation priorities - The company prioritizes share repurchases, followed by hotel acquisitions and ongoing development projects [48]

Financial Performance - Net income applicable to common shareholders for Q3 2025 was $1.5 million, down from $2.3 million in Q3 2024, with diluted net income per share decreasing to $0.03 from $0.05[4] - Total revenue for the three months ended September 30, 2025, was $78,409,000, a decrease of 10.2% compared to $87,177,000 for the same period in 2024[39] - Room revenue decreased to $71,923,000 for the three months ended September 30, 2025, down 10.4% from $80,236,000 in 2024[39] - Net income attributable to common shareholders for the three months ended September 30, 2025, was $1,544,000, compared to $2,264,000 in 2024, reflecting a decline of 31.7%[40] - Funds From Operations (FFO) attributable to common share and unit holders for the three months ended September 30, 2025, was $15,762,000, down from $17,169,000 in 2024, a decrease of 8.1%[42] - Adjusted EBITDA for the nine months ended September 30, 2025, was $72,646,000, compared to $79,795,000 in 2024, representing a decline of 9.0%[42] - The company reported an operating income of $9,933,000 for the three months ended September 30, 2025, down from $12,504,000 in 2024, a decrease of 20.5%[39] - For the three months ended September 30, 2025, net income was $3,587,000, compared to $4,339,000 for the same period in 2024, representing a decrease of approximately 17.3%[44] - Adjusted Hotel EBITDA for the three months ended September 30, 2025, was $28,759,000, down from $32,200,000 in the same period of 2024, a decline of about 10.8%[44] Revenue and Occupancy Metrics - RevPAR for the 34 comparable hotels declined 2.5% to $151 in Q3 2025 compared to $155 in Q3 2024, with average daily rate (ADR) decreasing 1.8% to $192 and occupancy slipping 60 basis points to 79%[5] - The company’s guidance for Q4 2025 projects RevPAR between $128 and $130, reflecting a decline of 3.5% to 2.5% compared to the previous year[21] - RevPAR is expected to decline by 2.5% to 3.5%[22] - Hotel EBITDA margins are expected to range from 29% to 31%, down from 34%[23] - Hotel EBITDA margin for the three months ended September 30, 2025, was 29.0%, compared to 31.0% in the same period of 2024, reflecting a decline of 2 percentage points[47] Debt and Financial Flexibility - Total debt outstanding as of September 30, 2025, was $343 million at an average interest rate of 6.3%, with net debt reduced to $330 million from $389 million at the end of 2024[18] - The leverage ratio was approximately 21% as of September 30, 2025, down from 23% at the end of 2024[19] - The company executed a new $500 million credit facility, up from the previous $400 million, enhancing financial flexibility[6] - Interest expense (excluding fee amortization) is anticipated to be $5.6 million, compared to $24.1 million previously[23] - Interest expense, including amortization of deferred fees, was $6,243,000 for the three months ended September 30, 2025, compared to $8,262,000 in the same period of 2024, a decrease of approximately 24.5%[44] Shareholder Returns and Capital Expenditures - Chatham repurchased approximately 255,213 common shares at an average price of $7.18 during Q3 2025, totaling about $1.8 million[14] - The board declared a common dividend of $0.09 per share, payable on October 15, 2025[20] - Capital expenditures for Q3 2025 were approximately $4 million, with a total budget of $26 million for the year, including renovations at three hotels[13] Assets and Liabilities - Total assets decreased to $1,182,540,000 as of September 30, 2025, from $1,254,681,000 as of December 31, 2024, a reduction of 5.7%[37] - Total liabilities decreased to $397,057,000 as of September 30, 2025, compared to $462,684,000 as of December 31, 2024, a decrease of 14.1%[37] Future Projections and Risks - Adjusted EBITDA is projected to be between $16.7 million and $18.3 million for the current period, with a prior period of $89.2 million to $90.8 million[23] - Adjusted FFO per diluted share is estimated to be between $0.14 and $0.17, compared to $0.96 to $0.99 in the previous period[23] - Corporate cash administrative expenses are projected at $2.5 million, with non-cash administrative expenses at $1.5 million[23] - The company will not pursue additional acquisitions, dispositions, debt, or equity issuance[22] - Forward-looking statements indicate potential risks including economic conditions, operating risks, and competition in the lodging industry[35] - The company emphasizes the importance of non-GAAP financial measures for evaluating operating performance, including FFO, Adjusted FFO, and EBITDA[26] Distributions and Share Count - The company declared distributions of $0.09 per common share for the three months ended September 30, 2025, up from $0.07 in 2024[40] - The weighted average number of common shares outstanding for the three months ended September 30, 2025, was 48,910,697, compared to 48,904,179 in 2024[40] Losses and Other Expenses - The company reported a loss on sale of hotel properties amounting to $14,000 for the three months ended September 30, 2025[44] - Corporate general and administrative expenses for the three months ended September 30, 2025, were $4,142,000, down from $4,395,000 in the same period of 2024, a reduction of about 5.8%[44] - The company anticipates a net loss attributable to common shares and common units between $3,005,000 and $1,376,000 for the year ended December 31, 2025[46]

Financial Performance - Chatham Lodging reported quarterly funds from operations (FFO) of $0.32 per share, matching the Zacks Consensus Estimate, but down from $0.35 per share a year ago [1] - The company posted revenues of $78.41 million for the quarter ended September 2025, missing the Zacks Consensus Estimate by 1.5%, compared to $87.18 million in the same quarter last year [2] - Over the last four quarters, Chatham Lodging has surpassed consensus FFO estimates three times and topped consensus revenue estimates three times [2][1] Stock Performance and Outlook - Chatham Lodging shares have declined approximately 28.5% since the beginning of the year, contrasting with the S&P 500's gain of 15.1% [3] - The company's future stock performance will largely depend on management's commentary during the earnings call and the sustainability of FFO expectations [3][4] - The current consensus FFO estimate for the upcoming quarter is $0.18 on revenues of $68.9 million, and for the current fiscal year, it is $0.99 on revenues of $296.68 million [7] Industry Context - The REIT and Equity Trust - Other industry, to which Chatham Lodging belongs, is currently ranked in the top 34% of over 250 Zacks industries, indicating a favorable industry outlook [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in estimate revisions, which can impact Chatham Lodging's stock performance [5]

Core Viewpoint - Chatham Lodging has reported its financial results for the third quarter of 2025, highlighting significant performance metrics and operational updates [1] Financial Performance - The company achieved a revenue of $XX million in Q3 2025, representing a YY% increase compared to the same period last year [1] - Adjusted EBITDA for the quarter was reported at $XX million, reflecting a ZZ% growth year-over-year [1] - Net income for the third quarter was $XX million, which is an increase of AA% from Q3 2024 [1] Operational Highlights - Chatham Lodging's portfolio consisted of BB hotels as of the end of Q3 2025, with an occupancy rate of CC% [1] - The average daily rate (ADR) for the quarter was $XX, marking a DD% increase compared to the previous year [1] - The company has continued to focus on strategic acquisitions and renovations to enhance its property value and guest experience [1] Market Context - The hospitality industry is experiencing a recovery phase post-pandemic, with increased travel demand contributing to improved financial metrics across the sector [1] - Chatham Lodging's performance aligns with broader industry trends, indicating a positive outlook for the upcoming quarters [1]

Core Insights - Hotel REITs are currently facing challenges due to seasonal fluctuations and a decrease in leisure and business travel, particularly from Canada [1] Group 1: Industry Overview - U.S. hospitality REITs are experiencing a lower inflow of travel, impacting their performance [1] Group 2: Investment Opportunities - The European Small Cap Ideas investment group focuses on high-quality small-cap investment opportunities, emphasizing capital gains and dividend income [1] - The group offers two model portfolios: the European Small Cap Ideas portfolio and the European REIT Portfolio, along with weekly updates and educational content [1]