Group 1: Company Situation - Spirit Airlines is in discussions with Castlelake for a potential takeover as it seeks a way out of Chapter 11 bankruptcy, having filed for protection twice in a year due to failed turnaround plans [1] - The airline has amended its agreement with creditors to secure an immediate $50 million in funding, with further funding contingent on progress in restructuring or a strategic transaction [4] - Spirit has significantly reduced its operations by cutting flights, downsizing its fleet, and laying off employees to save costs, with unions agreeing to $100 million in pay cuts for pilots and flight attendants [5] Group 2: Industry Context - The airline industry has faced challenges post-pandemic, including rising wages and costs, changing customer preferences, and an oversupply of domestic flights leading to lower airfares, particularly affecting U.S.-focused carriers [6] - Spirit's operational difficulties were exacerbated by a Pratt & Whitney engine recall that grounded many of its Airbus aircraft and a blocked acquisition by JetBlue due to antitrust concerns [7] - In an effort to attract higher-spending customers, Spirit has been introducing roomier seats and bundled fare options to compete with larger airlines that have benefited from affluent customers post-pandemic [8]

Core Viewpoint - Pebblebrook Hotel Trust (PEB) does not provide significant income to its common shareholders, but it possesses a portfolio of high-quality hospitality assets and strong preferreds coverage, indicating potential for long-term value creation [1]. Group 1: Company Overview - Pebblebrook Hotel Trust is an internally managed Real Estate Investment Trust (REIT) focused on high-quality hospitality assets [1]. - The company’s strategy emphasizes long-term wealth creation through investments in undervalued, high-growth companies, high-dividend stocks, REITs, and green energy firms [1]. Group 2: Market Dynamics - The equity market serves as a powerful mechanism for wealth creation or destruction over the long term, influenced by daily price fluctuations [1].

Core Viewpoint - Pebblebrook Hotel Trust will report its financial and operating results for Q4 2025 on February 25, 2026, after market close, with a conference call scheduled for February 26, 2026, at 9:00 AM ET [1][2]. Company Overview - Pebblebrook Hotel Trust is a publicly traded real estate investment trust (REIT) and the largest owner of urban and resort lifestyle hotels in the United States [3]. - The company owns 44 hotels, totaling approximately 11,000 guest rooms across 13 urban and resort markets [3].

Core Insights - Pebblebrook Hotel Trust (PEB) has sold the Westin Michigan Avenue Chicago for $72 million to enhance financial flexibility [1][9] - The sale reflects a 15.6X EBITDA multiple and a 3.5% NOI capitalization rate based on recent performance [2][9] - Proceeds from the sale will be used to improve the company's debt position and repurchase common shares [3][4] Financial Position - Following the recent asset sales, Pebblebrook's consolidated debt and convertible notes are expected to total $2.1 billion, with $761 million in preferred equity [4] - The net debt to trailing 12-month corporate EBITDA ratio is projected to decrease to approximately 5.9X [4] - The company anticipates that the loss of hotel-level EBITDA will be offset by reduced interest expenses from the lower outstanding debt balance, leaving the 2025 financial outlook largely unchanged [5] Market Challenges - Pebblebrook is experiencing pressure from weak performance in Los Angeles and Washington, D.C., exacerbated by a prolonged government shutdown [6] - Factors such as cancellations, soft group business, weak international inbound travel, and macroeconomic uncertainty are limiting pricing power and RevPAR growth [6] - Over the past three months, PEB shares have declined by 6.7%, contrasting with the industry's growth of 1.7% [6]

Core Insights - Pebblebrook Hotel Trust released its seventh annual Corporate Sustainability Report, showcasing its 2024 performance and ongoing commitment to responsible business practices and sustainability [1] Group 1: Sustainability Reporting - The 2025 Corporate Sustainability Report aligns with international frameworks such as the Global Reporting Initiative (GRI) and includes disclosures per the Real Estate Sustainability Accounting Standard of the Sustainability Accounting Standards Board (SASB) [2] - The company has enhanced its sustainability risk evaluation by following the guidelines of the Task Force on Climate-Related Financial Disclosure (TCFD), incorporating elements from the International Sustainability Standards Board's (ISSB) IFRS climate-related disclosures for the first time [2] Group 2: Environmental Goals and Achievements - Pebblebrook aims to reduce greenhouse gas emissions intensity by 35% by 2030, with significant progress already made across its portfolio [3] - Key achievements include a 41% reduction in greenhouse gas (GHG) emissions intensity per square foot, a 26% decrease in energy intensity per square foot, and a 69% decline in waste intensity per occupied room [7] Group 3: Corporate Governance - The CSR Committee comprises three independent members of the Board of Trustees, one executive officer, and four senior employees, indicating a structured approach to sustainability governance [5] Group 4: Company Overview - Pebblebrook Hotel Trust is a publicly traded real estate investment trust (REIT) and the largest owner of urban and resort lifestyle hotels in the U.S., owning 44 hotels and resorts with approximately 11,000 guest rooms across 13 markets [6]

Core Viewpoint - Momentum investing focuses on "buying high and selling higher" rather than traditional strategies of "buying low and selling high" [1] Group 1: Momentum Investing Strategy - Momentum investors often face challenges in determining the right entry point, as stocks may lose momentum when their valuations exceed future growth potential [2] - Investing in bargain stocks that exhibit recent price momentum can be a safer strategy, utilizing tools like the Zacks Momentum Style Score to identify promising stocks [3] Group 2: Pebblebrook Hotel (PEB) Analysis - Pebblebrook Hotel (PEB) has shown a four-week price change of 5.4%, indicating growing investor interest [4] - Over the past 12 weeks, PEB's stock has gained 11.6%, with a beta of 1.85, suggesting it moves 85% more than the market [5] - PEB has a Momentum Score of B, indicating a favorable time to invest based on momentum [6] Group 3: Earnings Estimates and Valuation - PEB has received a Zacks Rank 1 (Strong Buy) due to upward revisions in earnings estimates, which attract more investors [7] - The stock is trading at a Price-to-Sales ratio of 0.88, suggesting it is undervalued as investors pay only 88 cents for each dollar of sales [7] Group 4: Additional Investment Opportunities - Besides PEB, there are other stocks that meet the criteria of the 'Fast-Paced Momentum at a Bargain' screen, presenting further investment opportunities [8] - Various Zacks Premium Screens are available to assist in identifying potential winning stocks based on different investing styles [9]

Core Viewpoint - Pebblebrook Hotel (PEB) is showing potential as a strong investment opportunity due to its recent technical indicators and positive earnings revisions [1][4]. Technical Analysis - PEB has recently surpassed the 20-day moving average, indicating a short-term bullish trend [1][2]. - The stock has gained 10.8% over the past four weeks, suggesting positive momentum [4]. Earnings Estimates - There have been no downward revisions in earnings estimates for PEB in the past two months, while five estimates have been raised for the current fiscal year [4]. - The consensus earnings estimate for PEB has also increased, reinforcing the bullish outlook [4][5]. Investment Recommendation - Given the positive technical indicators and favorable earnings estimate revisions, PEB is recommended for investors looking for potential gains in the near future [5].

Core Viewpoint - Pebblebrook Hotel (PEB) shows potential as a stock pick due to surpassing key technical resistance levels, indicating a bullish trend [1][2]. Technical Analysis - PEB has recently surpassed the 50-day moving average, a significant indicator of support and resistance, suggesting a short-term bullish trend [1][2]. - Over the past four weeks, PEB's stock price has increased by 10.8%, reflecting positive momentum [2]. Earnings Estimates - There have been five upward revisions in earnings estimates for PEB for the current fiscal year, with no downward revisions, indicating strong investor confidence [3]. - The consensus earnings estimate for PEB has also increased, further supporting the bullish outlook [3]. Investment Consideration - Given the positive technical indicators and favorable earnings estimate revisions, PEB is recommended for inclusion on investors' watchlists [3].

Group 1 - The article emphasizes the importance of enabling Javascript and cookies in browsers to prevent access issues [1] - It highlights that users with ad-blockers may face restrictions when trying to access content [1]

Financial Data and Key Metrics Changes - Same property hotel EBITDA totaled $105.4 million, in line with the midpoint of guidance, while adjusted EBITDA came in at $99.2 million, exceeding the midpoint by $2.2 million [3] - Adjusted FFO per share was $0.01, $0.03 above the midpoint, reflecting resilience in the operating model and disciplined cost management [3] - Same property occupancy increased nearly 190 basis points, while ADR declined 5.4%, resulting in a 3.1% decline in RevPAR and a 1.5% drop in same property total RevPAR [3][4] Business Line Data and Key Metrics Changes - Performance was led by properties in San Francisco and Chicago, with San Francisco's RevPAR rising 8.3% due to a 690 basis point jump in occupancy [4][5] - The resort portfolio remained resilient, with total RevPAR increasing by 0.7%, driven by Newport Harbor Island Resort's RevPAR jumping 29% [6] - Urban total RevPAR declined 2.7%, with strength in San Francisco and Chicago offset by weakness in Los Angeles and Washington, D.C. [7] Market Data and Key Metrics Changes - Washington, D.C. was the softest market, with RevPAR down 16.4% due to reduced government travel demand [7] - Los Angeles experienced a 10.4% decline in RevPAR, driven by adverse weather conditions [8] - Boston and San Diego also saw year-over-year declines attributed to lighter convention calendars and softer group attendance [8] Company Strategy and Development Direction - The company is focused on driving operating efficiencies and disciplined cost management, with a strategic redevelopment program enhancing market share and profitability [6][17] - The company plans to leverage favorable macroeconomic conditions and a robust events calendar in 2026 to drive growth [30] - The company is investing in AI-enabled tools to improve operational efficiency and reduce costs [17][42] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism for Q4 due to macroeconomic uncertainty and the ongoing government shutdown impacting travel [18][20] - The company anticipates a favorable setup for 2026, with expectations of normalized hotel demand correlating with GDP growth [22][23] - Management highlighted the potential for significant demand growth driven by major events and a favorable holiday calendar in 2026 [27][28] Other Important Information - The company entered into an agreement to sell one of its hotels for $72 million, expected to close in Q4 [11] - The company successfully completed a $400 million offering of convertible notes, using proceeds to retire existing debt [12] - The company expects to generate over $100 million in free cash flow by the end of 2026 [12] Q&A Session Summary Question: Inquiry about San Francisco lodging performance - Management noted that San Francisco is experiencing strong demand, allowing for increased room rates during high-occupancy nights [31][34] Question: Impact of AI industry on demand - Management observed a growing number of companies booking transient and group business, particularly in the AI sector, positively impacting weekday demand [37][38] Question: Expense management and labor costs - Management confirmed that efficiency improvements and reduced headcount are contributing to lower costs, with expectations for moderated labor costs in 2026 [39][40] Question: Future performance of Los Angeles market - Management expects Los Angeles to perform better in 2026 due to easier comps and a recovery in entertainment production [42] Question: Transaction market outlook - Management indicated a pause in the transaction market due to macro uncertainty but anticipates pent-up demand for transactions once clarity returns [44][46] Question: Attrition trends in bookings - Management noted increased attrition primarily in government-related bookings, but overall attrition payments were lower year-over-year [56][57]