AUSTIN, Texas, March 31, 2025 /PRNewswire/ -- Summit Hotel Properties, Inc. (NYSE: INN) (the "Company") today announced that it has successfully closed on a new $275 million senior unsecured term loan (the "Term Loan"). The Company expects to utilize future proceeds from the Term Loan to repay the majority of the Company's outstanding $287.5 million 1.50% Convertible Senior Notes maturing in February 2026. The Term Loan includes a delayed draw feature available to the Company through March 1, 2026, that wil ...

Company Overview - Summit Hotel Properties, Inc. is a publicly traded real estate investment trust focused on owning premium-branded lodging facilities with efficient operating models primarily in the upscale segment of the lodging industry [2] - As of March 26, 2025, the Company's portfolio consisted of 97 assets, 53 of which are wholly owned, with a total of 14,554 guestrooms located in 25 states [2] Financial Reporting - The Company will report financial results for the first quarter of 2025 on Wednesday, April 30, 2025, after the market closes [1] - A quarterly conference call will be conducted on Thursday, May 1, 2025, at 9:00 AM ET [1] Conference Call Access - To access the conference call, pre-registration is required, and registrants will receive a confirmation with dial-in details [4] - A live webcast of the conference call will be available, with a replay accessible in the Investors section of the Company's website until July 31, 2025 [4]

Core Viewpoint - The comparison between Summit Hotel Properties (INN) and National Health Investors (NHI) indicates that INN currently offers better value for investors based on various financial metrics and rankings [1][3][6]. Valuation Metrics - Summit Hotel Properties has a Zacks Rank of 2 (Buy), while National Health Investors has a Zacks Rank of 3 (Hold), suggesting a more favorable earnings outlook for INN [3]. - INN has a forward P/E ratio of 6.19, significantly lower than NHI's forward P/E of 15.80, indicating that INN may be undervalued [5]. - The PEG ratio for INN is 1.32, while NHI's PEG ratio is 4.67, further supporting the notion that INN is a better value option considering expected earnings growth [5]. - INN's P/B ratio stands at 0.45, compared to NHI's P/B of 2.42, reinforcing the assessment of INN as undervalued relative to its book value [6]. - Based on these valuation metrics, INN holds a Value grade of A, while NHI has a Value grade of D, highlighting INN's superior position in terms of value investment [6].

Core Viewpoint - Summit Hotel Properties (INN) and Gaming and Leisure Properties (GLPI) are being compared to determine which stock offers better value for investors at the current time [1] Group 1: Valuation Metrics - INN has a forward P/E ratio of 6.77, while GLPI has a forward P/E of 12.71 [5] - INN's PEG ratio is 1.44, indicating a more favorable valuation compared to GLPI's PEG ratio of 3.31 [5] - INN's P/B ratio is 0.51, significantly lower than GLPI's P/B of 2.92, suggesting that INN is undervalued relative to its book value [6] Group 2: Investment Ratings - Both INN and GLPI currently hold a Zacks Rank of 2 (Buy), indicating a positive earnings outlook for both stocks [3] - INN has been assigned a Value grade of A, while GLPI has a Value grade of C, highlighting INN's superior valuation metrics [6][7]

Financial Data and Key Metrics Changes - In 2024, the company achieved a full year AFFO per share growth of nearly 6% [5] - Pro forma RevPAR growth increased by 1.8% for the year, surpassing the industry average for the third consecutive year [6][24] - Pro forma hotel EBITDA increased by 2% year-over-year, despite a low RevPAR growth environment [6] - Adjusted FFO for full year 2024 was $119.2 million, an increase of nearly 6% versus 2023, with AFFO rising to $0.96 per share from $0.92 per share [28] Business Line Data and Key Metrics Changes - Urban and suburban portfolios saw RevPAR increases of nearly 3% and 4% respectively, outpacing the total industry by 100 and 220 basis points [24] - Resort and small-town metro assets experienced a modest decline in RevPAR, primarily due to Hurricane Helene and ongoing renovations [26] - Pro forma hotel EBITDA for the fourth quarter was $60.4 million, representing a modest decline compared to the previous year [32] Market Data and Key Metrics Changes - Key markets such as New Orleans, Indianapolis, Chicago, Houston, Minneapolis, and Tampa significantly outpaced the pro forma portfolio in the fourth quarter [29] - The company identified six markets poised for outsized growth, including Baltimore, Louisville, Minneapolis, New Orleans, San Francisco, and San Jose, with five markets achieving over 13% RevPAR growth [9][10] Company Strategy and Development Direction - The company continues to focus on disciplined acquisitions and dispositions, acquiring two hotels for $96 million with an attractive capitalization rate of 8.8% [11][12] - A strategic capital investment approach has improved the overall quality of the portfolio, with a RevPAR market share index increasing nearly 300 basis points over the last three years [14] - The company anticipates continued top-line growth in 2025, driven by robust group demand and the recovery of business transient travel [18][22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in controlling operating expenses despite more challenging year-over-year comparisons in 2025 [21] - The lodging sector is expected to benefit from a long-term consumer shift towards experiences over material goods, reinforcing a stable demand outlook [22] - The company expects RevPAR growth of 1% to 3% for 2025, with adjusted EBITDA projected between $184 million and $198 million [39] Other Important Information - The company has a total liquidity of approximately $350 million and a leverage ratio nearly a full turn lower than when it initiated its disposition activity [36] - A quarterly common dividend of $0.08 per share was declared, representing a yield of approximately 5% [37] Q&A Session Summary Question: Booking pace and business-oriented demand outlook - Management noted that January was impacted by weather disruptions, but February showed strong RevPAR growth due to Super Bowl demand and catch-up bookings [44][46] Question: Future acquisition strategy - The company plans to remain active in transactions, focusing on high-quality assets and being opportunistic in capital recycling [49][51] Question: RevPAR guidance for 2025 - Management expects continued strength in urban and suburban markets, with a more balanced growth profile compared to 2024 [55] Question: Management company changes and expense management - Changes were made to improve operational efficiency, and management is pleased with the current performance of management companies [60][61] Question: Acquisitions and underwriting returns - The company is excited about recent acquisitions, expecting higher unlevered IRRs compared to pre-pandemic levels [64] Question: Corporate customer trends - Gradual changes in business travel patterns were noted, with a return of larger national accounts [70] Question: Labor market stability - Management indicated that labor markets remain stable, with expectations for continued effective expense management [76][77] Question: Disposition strategy - The company balances capital needs and brand considerations when deciding on asset sales [79][81] Question: GIC joint venture growth - The joint venture continues to perform well, with an appetite for further growth in 2025 [85] Question: Capital markets environment for transactions - The capital markets are improving, making financing accessible for acquisitions [88]

Core Viewpoint - Summit Hotel Properties (INN) reported quarterly funds from operations (FFO) of $0.20 per share, exceeding the Zacks Consensus Estimate of $0.19 per share, but down from $0.22 per share a year ago [1][2] Financial Performance - The FFO surprise for the quarter was 5.26%, and the company has surpassed consensus FFO estimates for four consecutive quarters [2] - Revenues for the quarter ended December 2024 were $172.93 million, surpassing the Zacks Consensus Estimate by 1.01%, but down from $177.44 million year-over-year [3] Market Performance - Summit Hotel Properties shares have declined approximately 7.7% since the beginning of the year, while the S&P 500 has gained 2.2% [4] - The current consensus FFO estimate for the upcoming quarter is $0.23 on revenues of $185.2 million, and for the current fiscal year, it is $0.92 on revenues of $747.22 million [8] Industry Outlook - The REIT and Equity Trust - Other industry is currently ranked in the bottom 44% of over 250 Zacks industries, indicating potential challenges for stock performance [9]

Financial Performance - In 2024, the company experienced same-store revenue growth driven by strong group and improved business transient demand, partially offset by normalization in leisure demand [217]. - Total room revenue for 2024 was $650.7 million, a decrease of 0.8% compared to $656.1 million in 2023, while same-store room revenue increased by 2.0% [236]. - The average daily rate (ADR) for 2024 was $167.48, up 1.5% from $165.04 in 2023, while revenue per available room (RevPAR) increased by 3.7% to $123.19 [236]. - The company's occupancy rate improved to 73.6% in 2024 from 72.0% in 2023, reflecting a year-over-year increase of 2.2% [236]. - Net income for 2024 was $38.891 million, a significant recovery from a loss of $28.116 million in 2023 [247]. - FFO applicable to common shares and Common Units increased to $115.160 million in 2024, up from $96.778 million in 2023, representing a growth of 19.5% [247]. - AFFO applicable to common shares and Common Units rose to $119.206 million in 2024, compared to $112.892 million in 2023, marking an increase of 5.8% [247]. - EBITDA for 2024 was reported at $258.387 million, an increase from $211.836 million in 2023, reflecting a growth of 22% [258]. - The company reported a net income of $164,300,000 for the year ended December 31, 2024, compared to $153,000,000 in 2023, reflecting an increase of 7.4% [285]. Property Transactions - In May 2023, the company sold four lodging properties for a total gross selling price of $28.1 million, with a write-down of $2.9 million recorded prior to the sale [222]. - The GIC Joint Venture acquired the Residence Inn by Marriott in Scottsdale, AZ for approximately $29.0 million in June 2023, with capital contributions from both GIC and the Operating Partnership [223]. - In April 2024, the company completed the sale of two properties in New Orleans for an aggregate selling price of $73.0 million, resulting in a gain of approximately $28.3 million [227]. - Room revenues for the total portfolio decreased by $5.4 million for the year ended December 31, 2024, compared to 2023, primarily due to a $17.5 million decrease from the sale of five lodging properties [237]. - The company completed the acquisition of two hotels in December 2024 for a combined purchase price of $96.0 million, funded through various financing sources [270]. Operating Expenses - The company recorded total operating expenses of $402.2 million in 2024, a decrease of 0.6% compared to $404.5 million in 2023 [236]. - The company’s other revenue, which includes ancillary services, increased by 4.3% to $40.2 million in 2024 compared to $38.6 million in 2023 [236]. - Room expenses decreased by $1.2 million for the year ended December 31, 2024, due to a $5.7 million decrease from the sale of properties, partially offset by a $4.5 million increase in same-store room expenses [238]. - Property taxes, insurance, and other expenses decreased by $1.1 million, mainly due to successful property tax appeal efforts and reductions in state franchise taxes [241]. - Management fees decreased by $2.6 million due to the net effect of property sales and lower management fees from amendments to property management agreements [241]. - Depreciation and amortization expenses decreased by $4.5 million, primarily due to the sale of properties, partially offset by an increase in same-store depreciation from completed renovations [241]. - Interest expense decreased by $4.2 million for the year ended December 31, 2024, compared to 2023 [240]. Debt and Financing - As of December 31, 2024, the company had $10.0 million outstanding on its $400 Million Revolver and $200.0 million on its $200 Million Term Loan [272]. - The GIC Joint Venture had $250.0 million outstanding under its credit facility, which includes a $125.0 million term loan and a $125.0 million revolving line of credit [273]. - The company entered into a $200 million senior unsecured term loan in February 2024, with an initial maturity date of February 2027 [267]. - The company expects to complete the refinancing of $287.5 million of Convertible Notes due in February 2026 prior to their maturity date [272]. - Scheduled debt principal payments for the next 12 months total $46.6 million, primarily due to a loan maturing in June 2025 [277]. - Total debt as of December 31, 2024, is $1,408,007,000, a decrease from $1,445,839,000 in 2023, representing a reduction of approximately 2.9% [280]. - The total joint venture debt as of December 31, 2024, is $710,507,000, an increase from $675,878,000 in 2023 [280]. - The company expects to fund future capital expenditures through cash on hand, working capital, and borrowings under the $400 million revolver [284]. Capital Expenditures - Capital expenditures for the year ended December 31, 2024, amounted to $89,300,000, with an additional $5,200,000 for development expenditures [283]. - The company anticipates capital expenditures between $65,000,000 and $85,000,000 for the year ending December 31, 2025 [284]. Market and Economic Conditions - The lodging industry is sensitive to economic conditions, with performance correlated to U.S. GDP growth and discretionary spending levels [117]. - High inflation rates have moderated but remain above historical levels, potentially affecting operating costs and consumer demand for lodging [114]. - The lodging industry is highly competitive, with significant competition from alternative accommodations like Airbnb, affecting occupancy and revenue [118]. - Operating results are subject to risks such as dependence on business travelers, over-building in markets, and increases in energy costs [120]. - Consumer preferences are shifting, particularly among younger generations, which may affect demand for select-service hotels [127]. - Real estate investments are illiquid, making it difficult to respond to adverse market changes [128]. - Changes in state and local tax rates could increase tax liabilities, adversely affecting financial performance [138]. Regulatory and Compliance Risks - Compliance with environmental and safety regulations may result in significant costs and liabilities [130]. - The company evaluates long-term assets for impairment based on qualitative and quantitative factors, including projected cash flows and market conditions [295]. - The company is subject to a 4% non-deductible excise tax if the actual amount paid to stockholders is less than a minimum specified amount under the IRC [164]. - The company’s ability to meet REIT distribution requirements may force it to borrow funds or sell assets during unfavorable market conditions [165]. - The company must ensure that at least 100 persons beneficially own its capital stock during at least 335 days of a taxable year to maintain REIT status [176]. Risks and Challenges - Cybersecurity risks could disrupt operations and adversely affect revenue, with the company relying on third-party managers for IT security [103]. - The company may face challenges in managing rapidly advancing artificial intelligence, which could impact its competitive position [111]. - The company faces ongoing capital expenditure needs for renovations and improvements, which may impact financial performance [123]. - Development of lodging properties involves risks related to timing and budgeting, potentially affecting financial outcomes [124]. - Increased use of online travel agents (OTAs) could lead to higher commissions and reduced guestroom rates, negatively impacting revenue [125]. - Conflicts of interest may arise due to fiduciary duties owed to limited partners of the Operating Partnership [139]. Corporate Governance - The company has opted out of the business combination provisions of the Maryland General Corporation Law, allowing business combinations to be approved by the board of directors without stockholder consent [142]. - Stockholders' claims are structurally subordinated to all liabilities of the Operating Partnership, which may affect their recovery in bankruptcy or liquidation scenarios [149]. - The company owns approximately 87% of the Common Units in the Operating Partnership, with potential dilution from future issuances [150]. - The board of directors can revoke the company's REIT qualification without stockholder approval, which could lead to federal income tax liabilities [147]. - The company has limited voting rights for stockholders, making it difficult to remove directors or influence major policy changes [144]. - The company may execute future offerings of debt securities and equity securities, which could dilute existing common stockholders' holdings and potentially reduce the market price of common stock [160].

Core Insights - Summit Hotel Properties, Inc. reported a full-year operating income of $103.5 million and an adjusted EBITDAre of $192.2 million for 2024, with an AFFO increase of 5.6% to $0.96 per share [1][5][7] - The company completed over $200 million in accretive transaction activity in 2024, including the acquisition of two hotels for $96 million, which reflects an 8.8% net capitalization rate based on 2024 net operating income [2][11][12] - The outlook for 2025 is positive, driven by stable demand trends and anticipated growth in urban markets, with expected pro forma RevPAR growth between 1.00% and 3.00% [3][20] Financial Performance - For Q4 2024, net income attributable to common stockholders was $0.7 million, or $0.01 per diluted share, compared to a net loss of $16.6 million, or $0.16 per diluted share, in Q4 2023 [7][8] - Pro forma RevPAR increased by 1.4% to $117.21 in Q4 2024, while same-store RevPAR increased by 1.3% to $116.52 [7][8] - Total revenues for the full year 2024 were $731.8 million, a slight decrease from $736.1 million in 2023 [8][33] Acquisition and Disposition Activity - The company acquired the Hampton Inn Boston-Logan Airport and Hilton Garden Inn Tysons Corner, enhancing its portfolio quality and growth profile [2][11] - In 2024, the company sold five hotels for nearly $112 million, contributing to a total of 10 hotels sold since 2023 for approximately $150 million [14][15] Capital Structure and Dividends - As of December 31, 2024, the company had outstanding debt of $1.1 billion with a weighted average interest rate of 4.55% [21] - The company declared a quarterly cash dividend of $0.08 per share, representing an annualized yield of 5.1% based on the closing price on February 21, 2025 [17][18] 2025 Outlook - The company anticipates adjusted EBITDAre for 2025 to be between $184 million and $198 million, with adjusted FFO projected between $111.9 million and $125.6 million [20][19] - Capital expenditures for 2025 are expected to range from $65 million to $85 million [20]

Company Overview - Summit Hotel Properties, Inc. is a publicly traded real estate investment trust focused on owning premium-branded lodging facilities with efficient operating models primarily in the upscale segment of the lodging industry [2] - As of February 19, 2025, the Company's portfolio consisted of 97 assets, 53 of which are wholly owned, with a total of 14,553 guestrooms located in 25 states [2] Upcoming Events - The 2025 Annual Meeting of Stockholders will be held on May 21, 2025, at 8:00 a.m. Eastern Time [1] - The meeting location is the Courtyard by Marriott Oceanside Fort Lauderdale Beach, 440 Seabreeze Boulevard, Fort Lauderdale, Florida 33316 [1] - The meeting is open to all stockholders of record as of March 5, 2025 [1]

Core Viewpoint - Summit Hotel Properties, Inc. has declared cash dividends for both common and preferred stock for the fourth quarter of 2024 and the upcoming dividend period ending February 28, 2025, reflecting the company's commitment to returning value to shareholders [1][2][3]. Dividend Announcements - The company declared a cash dividend of $0.08 per share for the fourth quarter ended December 31, 2024, which corresponds to an annualized dividend yield of 4.8% based on the closing stock price on January 22, 2025 [1]. - A cash dividend of $0.390625 per share has been authorized for the 6.25% Series E Cumulative Redeemable Preferred Stock for the dividend period ending February 28, 2025 [2]. - A cash dividend of $0.3671875 per share has been declared for the 5.875% Series F Cumulative Redeemable Preferred Stock for the same dividend period [2]. - Additionally, a cash distribution of $0.328125 per unit has been authorized for the unregistered 5.25% Series Z Cumulative Perpetual Preferred Units for the distribution period ending February 28, 2025 [3]. - All dividends are payable on February 28, 2025, to holders of record as of February 14, 2025 [3]. Company Overview - Summit Hotel Properties, Inc. is a publicly-traded real estate investment trust focused on owning premium-branded lodging properties primarily in the Upscale segment of the lodging industry [4]. - As of January 23, 2025, the company's portfolio consists of 97 assets, including 53 wholly owned properties, with a total of 14,553 guestrooms located across 25 states [4].