Core Insights - During market turbulence, investors often seek dividend-yielding stocks, which typically have high free cash flows and offer substantial dividends [1] Group 1: Company Ratings and Analyst Insights - OUTFRONT Media Inc. has a dividend yield of 8.00%. Morgan Stanley analyst Benjamin Swinburne maintained an Equal-Weight rating and reduced the price target from $18 to $17, with an accuracy rate of 77%. TD Cowen analyst Lance Vitanza initiated coverage with a Hold rating and a price target of $16, having an accuracy rate of 75%. Recent news indicated worse-than-expected first-quarter financial results [7] - Healthcare Realty Trust Incorporated has a dividend yield of 8.08%. Wedbush analyst Richard Anderson maintained a Neutral rating and cut the price target from $18 to $16, with an accuracy rate of 62%. Wells Fargo analyst James Feldman assumed coverage with an Underweight rating and raised the price target from $16 to $17, having an accuracy rate of 61%. Recent news showed downbeat quarterly sales results [7] - Park Hotels & Resorts Inc. has a dividend yield of 9.63%. Morgan Stanley analyst Stephen Grambling maintained an Equal-Weight rating and reduced the price target from $12 to $10, with an accuracy rate of 63%. Truist Securities analyst Patrick Scholes maintained a Buy rating and cut the price target from $18 to $16, having an accuracy rate of 65%. Recent news reported better-than-expected quarterly results [7]

Company Overview - Park Hotels & Resorts Inc. has interests in 40 hotels with approximately 25,000 rooms, over 87% of which are luxury and upper upscale, located in prime U.S. markets[61]. Financial Performance - The company reported a net loss of $57 million for the three months ended March 31, 2025, compared to a net income of $29 million for the same period in 2024[78]. - Adjusted EBITDA for the same period was $144 million, down from $162 million year-over-year[78]. - Hotel Adjusted EBITDA was $151 million for the three months ended March 31, 2025, compared to $169 million for the same period in 2024[78]. - For the three months ended March 31, 2025, the company reported a net loss attributable to stockholders of $57 million, compared to a net income of $28 million for the same period in 2024[82]. - Adjusted FFO attributable to stockholders for the three months ended March 31, 2025 was $92 million, down from $111 million in 2024, with Adjusted FFO per diluted share decreasing from $0.52 to $0.46[82]. - Total hotel revenues for the three months ended March 31, 2025 were $363 million, a decrease of $11 million compared to $374 million in 2024[85]. - The company recognized impairment losses of approximately $70 million for the three months ended March 31, 2025, compared to $5 million in the same period of 2024[94]. - Interest expense for the three months ended March 31, 2025 was $52 million, a slight decrease of 1.9% from $53 million in 2024[97]. Liquidity and Capital Management - As of March 31, 2025, the company had total cash and cash equivalents of $233 million and $27 million of restricted cash, providing sufficient liquidity for upcoming obligations[99]. - The company has $950 million available under its revolving credit facility, ensuring liquidity to meet debt maturities and other obligations over the next 12 months[100]. - The company intends to distribute at least 90% of its REIT taxable income to stockholders, limiting its ability to retain substantial cash balances for liquidity needs[111]. - The company aims to maintain liquidity, minimize operational costs, and fund capital expenditures and future acquisitions through cash management objectives[105]. Capital Expenditures and Investments - The company has construction contract commitments of approximately $121 million for capital expenditures, including $40 million for guestroom renovations at Hilton Hawaiian Village and $30 million for renovations at Royal Palm South Beach Miami[104]. - Net cash used in investing activities was $77 million for the three months ended March 31, 2025, compared to $70 million in 2024, reflecting increased capital expenditures[109]. - The company reported a 10% increase in net cash used in investing activities, indicating a focus on capital improvements[109]. Operational Insights - Average Daily Rate (ADR) has shown improvements, although growth has slowed as the industry recovery stabilizes[65]. - Revenue per Available Room (RevPAR) is considered a key performance indicator, correlating occupancy and ADR[68]. - The Orlando hotels experienced a 9% increase in food and beverage revenue for the three months ended March 31, 2025, attributed to renovations completed in early 2024[87]. - The Hilton New Orleans Riverside saw a 14.6% increase in ADR due to increased group demand from the Super Bowl held in February 2025[89]. - The Hawaii hotels reported a decline in occupancy and ADR of 11.8 percentage points and 2.4%, respectively, due to decreased group and transient demand[90]. Future Outlook - The company is cautiously optimistic for 2025, expecting improvements in demand trends and increases in city-wide events despite macroeconomic uncertainties[65]. - The company has ceased payments on a $725 million non-recourse CMBS loan secured by two San Francisco hotels, which may lead to receivership[59]. - The company has a new stock repurchase program allowing for the repurchase of up to $300 million of common stock over a two-year period ending in February 2027[106]. Dividends - The company declared a first quarter dividend of $0.25 per share, payable on April 15, 2025, and a second quarter dividend of $0.25 per share, payable on July 15, 2025[103].

Financial Data and Key Metrics Changes - The company reported Q1 RevPAR of $178, representing a modest 70 basis point decline year-over-year, primarily due to difficult comparisons from last year's nearly 8% growth [19][22] - Total hotel revenues for the quarter were $608 million, with hotel adjusted EBITDA at $151 million, resulting in a nearly 25% hotel adjusted EBITDA margin [20][21] - Adjusted EBITDA for the quarter was $144 million, and adjusted FFO per share was $0.46 [21] Business Line Data and Key Metrics Changes - The Bonnet Creek complex in Orlando saw a 32% RevPAR increase, driven by a surge in transient revenues of nearly 65% [12] - Casa Marina in Key West reported a 12% RevPAR increase, despite tough comparisons from last year [13] - RevPAR across the two Hawaii properties declined by 15% during the quarter, with the Hilton Hawaiian Village being a significant drag on overall results [14] Market Data and Key Metrics Changes - Miami, New Orleans, Puerto Rico, Washington DC, and San Francisco reported above industry average RevPAR gains [8] - Preliminary April results showed mixed performance, with RevPAR growth of 1.6%, driven by strong gains in New York, Orlando, and San Francisco [16] - International demand represents just 10% of total room nights, with government-related business accounting for only 3% [17] Company Strategy and Development Direction - The company plans to invest $310 million to $330 million in capital improvements in 2025, focusing on unlocking embedded value in its portfolio [10] - A transformative renovation of the Royal Palm South Beach is set to begin, with expected returns exceeding 15% to 20% [9] - The company aims to sell $300 million to $400 million of non-core hotels this year to further deleverage the balance sheet [11] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the recovery of the Hilton Hawaiian Village, expecting mid-single-digit RevPAR growth in Q3 [31] - The near-term outlook for US lodging fundamentals remains uncertain due to ongoing global trade tensions [16] - Despite macro uncertainties, the company remains focused on factors within its control and is working closely with operators to manage expenses [17] Other Important Information - The company repurchased approximately 3.5 million shares for a total of $45 million during the quarter [11] - A $70 million impairment was recognized during the quarter related to an asset, though specific details were not disclosed [77][78] Q&A Session Summary Question: Comments on planned asset sales and current market conditions - Management acknowledged tremendous uncertainty in the market due to geopolitical factors but expressed confidence in their ability to transact even under challenging conditions [27][28] Question: Insights on Hawaii's performance and recovery - Management indicated that the ramp-up post-strike is taking longer than expected, but they remain confident in Hawaii's long-term growth potential [32][33] Question: Update on core hotel portfolio and asset sales - The company is focusing on its top 20 core assets, which account for 85-90% of the company's value, while working to sell non-core assets [38][39] Question: CapEx plans and timing for Miami renovations - Management confirmed that they have secured necessary permits and are on track to complete renovations before the World Cup next year [43] Question: Market performance expectations for 2025 - Management expects strong performance in Orlando and Key West, with positive outlooks for New York and Denver as well [50][51] Question: Group pace and transient demand trends - Management noted that group bookings remain solid, while transient demand is showing some softness, particularly in international travel [108]

Core Insights - Park Hotels & Resorts reported $630 million in revenue for Q1 2025, a year-over-year decline of 1.4%, but exceeded the Zacks Consensus Estimate by 2.49% [1] - The company achieved an EPS of $0.46, up from $0.25 a year ago, representing a surprise of 12.20% over the consensus estimate of $0.41 [1] Financial Performance Metrics - Comparable RevPAR growth was -0.7%, better than the estimated -1.6% [4] - Other revenues reached $22 million, exceeding the estimate of $21.23 million, marking a 4.8% increase year-over-year [4] - Ancillary hotel revenues were $63 million, surpassing the estimate of $57.87 million, with a year-over-year change of 1.6% [4] - Food and beverage revenues stood at $182 million, slightly above the estimate of $177.61 million, with no change year-over-year [4] - Room revenues totaled $363 million, compared to the estimate of $354.98 million, reflecting a year-over-year decline of 2.9% [4] - Diluted EPS was reported at -$0.29, significantly below the estimate of $0.03 [4] Stock Performance - Shares of Park Hotels & Resorts have returned +9.6% over the past month, outperforming the Zacks S&P 500 composite's +0.4% change [3] - The stock currently holds a Zacks Rank 5 (Strong Sell), indicating potential underperformance in the near term [3]

Financial Data and Key Metrics Changes - The company reported Q1 RevPAR of $178, reflecting a modest 70 basis point decline year-over-year, primarily due to difficult comparisons following last year's nearly 8% growth [18] - Total hotel revenues for the quarter were $608 million, with hotel adjusted EBITDA at $151 million, resulting in a nearly 25% hotel adjusted EBITDA margin [18] - Adjusted EBITDA for the quarter was $144 million, and adjusted FFO per share was $0.46 [19] Business Line Data and Key Metrics Changes - The Bonnet Creek complex in Orlando saw a 32% RevPAR increase, driven by a surge in transient revenues of nearly 65% [10] - Casa Marina in Key West delivered a 12% RevPAR increase, with occupancy up 680 basis points [11] - RevPAR across the two Hawaii properties declined by 15%, with Hilton Hawaiian Village significantly impacted by a labor strike [12] Market Data and Key Metrics Changes - Miami, New Orleans, Puerto Rico, Washington DC, and San Francisco reported above industry average RevPAR gains [5] - Preliminary April results showed mixed performance, with RevPAR growth of 1.6%, driven by strong gains in New York, Orlando, and San Francisco [15] - International demand represents just 10% of total room nights, with government-related business accounting for only 3% [16] Company Strategy and Development Direction - The company plans to invest $310 million to $330 million in capital improvements in 2025, focusing on unlocking embedded value in its portfolio [8] - A transformative renovation of the Royal Palm South Beach, Miami, is set to begin soon, with expected returns exceeding 15% to 20% [6] - The company aims to sell $300 million to $400 million of non-core hotels this year, with several assets in various stages of marketing [9] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the ongoing geopolitical uncertainties and their impact on decision-making in the market [26] - The outlook for Hawaii remains favorable, supported by limited new supply expected through at least 2029 [14] - Despite macro uncertainties, the company remains focused on factors within its control and is working closely with operators to manage operating expenses [16] Other Important Information - The company repurchased approximately 3.5 million shares for a total of $45 million during the quarter [9] - A $70 million impairment was recognized in the quarter, related to an asset whose true value was reassessed [75] Q&A Session Summary Question: Comments on planned asset sales and current market environment - Management acknowledged tremendous uncertainty in the market due to geopolitical issues and trade wars, but expressed confidence in their ability to transact even under challenging conditions [26][27] Question: Update on Hawaii's performance and ramp-up post-strike - Management noted that the ramp-up is taking longer than expected, with sequential improvement anticipated, and expressed confidence in Hawaii's long-term growth potential [30][31] Question: Changes in core hotels and capital allocation - The company has focused on trimming its portfolio to core assets that account for 85-90% of its value, with plans to recycle capital from non-core asset sales [35][36] Question: Group pace and market performance expectations - Management indicated that group pace is slightly down for Q2 and Q3 but remains strong for Q4, with confidence in the overall bookings for the year [60][61] Question: Performance of Hilton Hawaiian Village and EBITDA expectations - Management stated that while it is challenging to predict if EBITDA will exceed last year's performance, they remain bullish on Hawaii's long-term outlook [73][74]

FIRST QUARTER 2025 SUPPLEMENTAL DATA MARCH 31, 2025 ABOUT PARK AND SAFE HARBOR DISCLOSURE About Park Hotels & Resorts Inc. Park (NYSE: PK) is one of the largest publicly-traded lodging real estate investment trusts ("REIT") with a diverse portfolio of iconic and market-leading hotels and resorts with significant underlying real estate value. Park's portfolio currently consists of 40 premium-branded hotels and resorts with approximately 25,000 rooms primarily located in prime city center and resort locations ...

Core Viewpoint - Park Hotels & Resorts reported quarterly funds from operations (FFO) of $0.46 per share, exceeding the Zacks Consensus Estimate of $0.41 per share, but down from $0.52 per share a year ago, indicating a 12.20% surprise [1][2] Financial Performance - The company achieved revenues of $630 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 2.49%, although this is a decrease from $639 million in the same quarter last year [2] - Over the last four quarters, Park Hotels & Resorts has exceeded consensus FFO estimates two times and revenue estimates two times [2] Stock Performance and Outlook - Park Hotels & Resorts shares have declined approximately 27.1% since the beginning of the year, compared to a 3.3% decline in the S&P 500 [3] - The current consensus FFO estimate for the upcoming quarter is $0.58 on revenues of $681.84 million, and for the current fiscal year, it is $1.93 on revenues of $2.6 billion [7] Industry Context - The REIT and Equity Trust - Other industry, to which Park Hotels & Resorts belongs, is currently ranked in the bottom 37% of over 250 Zacks industries, suggesting potential challenges for stock performance [8]

Financial Performance - Total revenues for Q1 2025 were $630 million, a decrease of 1.4% compared to $639 million in Q1 2024[14] - Operating income fell significantly to $7 million, down 92.6% from $92 million in the same period last year[14] - Net loss attributable to stockholders was $57 million, compared to a net income of $28 million in Q1 2024, resulting in a loss per share of $0.29[16][25] - Adjusted EBITDA for Q1 2025 was $144 million, a decline of 11.1% from $162 million in Q1 2024[21] - Adjusted FFO attributable to stockholders for Q1 2025 was $92 million, down from $111 million in Q1 2024, representing a decrease of 17.1%[27] - Nareit FFO per share – Diluted for Q1 2025 was $0.33, compared to $0.40 in Q1 2024, a decline of 17.5%[27] - Comparable Hotel Adjusted EBITDA decreased to $151 million, down 10.4% from $169 million in the prior year[23] - Comparable total revenue per available room (Total RevPAR) for Q1 2025 was $297.30, reflecting a 0.5% increase from Q1 2024[50] - Total Comparable Hotel Revenue for Q1 2025 was $608 million, slightly down by 0.5% compared to $610 million in Q1 2024[51] - Comparable Hotel Adjusted EBITDA for Q1 2025 was $151 million, a decrease of 10.4% from $169 million in Q1 2024[51] Balance Sheet and Debt - The company reported a total asset value of $8.901 billion as of March 31, 2025, down from $9.161 billion at the end of 2024[13] - Total liabilities stood at $5.465 billion, a slight decrease from $5.567 billion at the end of 2024[13] - The company has $725 million in debt associated with hotels currently in receivership[5] - Cash and cash equivalents decreased to $233 million from $402 million at the end of 2024[13] - Net Debt as of March 31, 2025, increased to $3,760 million from $3,582 million as of December 31, 2024, reflecting a rise of 5%[30] - The Net Debt to TTM Comparable Adjusted EBITDA ratio as of March 31, 2025, was 5.95x, up from 5.52x at the end of 2024[30] - Total fixed rate debt as of March 31, 2025, was $3.66 billion, with a weighted average interest rate of 5.11%[80] - The company has $950 million of available capacity under the Revolver with no outstanding letters of credit as of May 5, 2025[82] Future Outlook - Full-year 2025 Comparable RevPAR is projected to range from $185 to $191, with a midpoint change of -2% compared to 2024[34] - Full-year 2025 Adjusted FFO per share – Diluted is expected to be between $1.79 and $2.09, indicating a potential decrease of $0.11 from previous estimates[34] - Total Revenues for the year ending December 31, 2025, are forecasted to be between $2,569 million and $2,643 million[38] - Comparable Hotel Adjusted EBITDA for 2025 is anticipated to range from $633 million to $692 million, reflecting a margin of 25.6% to 27.2%[38] - The company expects a net (loss) income attributable to stockholders for 2025 to range from $(16) million to $44 million[39] - The outlook for 2025 is influenced by macroeconomic factors, including inflation and potential changes in interest rates, which are outside the company's control[35] Hotel Operations Metrics - Comparable average daily rate (ADR) for Q1 2025 was $256.62, representing a 2.3% increase from Q1 2024[48] - Comparable occupancy rate for Q1 2025 was 69.2%, a decrease of 2.1 percentage points compared to Q1 2024[50] - Comparable revenue per available room (RevPAR) for Q1 2025 was $177.67, a slight decrease of 0.7% from Q1 2024[50] - In Hawaii, the comparable ADR decreased by 2.4% to $303.66, with occupancy at 78.4%[48] - In Orlando, the comparable ADR increased by 4.0% to $295.00, with occupancy rising to 79.9%[48] - The average daily rate (ADR) for Core Hotels increased by 3.3% to $287.54 in Q1 2025 from $278.45 in Q1 2024[53] - Occupancy rates for Core Hotels decreased by 2.8 percentage points to 72.2% in Q1 2025 compared to 75.0% in Q1 2024[53] - RevPAR for Core Hotels remained relatively stable, decreasing by 0.5% to $207.50 in Q1 2025 from $208.63 in Q1 2024[53] - The total revenue per available room (Total RevPAR) for Core Hotels increased by 0.7% to $353.48 in Q1 2025 from $350.87 in Q1 2024[53] Acquisitions and Dispositions - The company sold two hotels in 2024, generating gross proceeds of $76.3 million[67] - Total sales from hotel dispositions since 2018 amounted to approximately $2.21 billion from 38 hotels[65] - The company acquired 5,981 rooms through various acquisitions, including the Hilton Denver City Center and Hyatt Regency Boston[61] Tax and Refunds - The company received a state unemployment tax refund of approximately $4 million for its Hawaii hotels during Q1 2024[52] - The company reported a state unemployment tax refund of approximately $4 million for its Hawaii hotels in Q1 2024[57] Accounting and Financial Metrics - The Company emphasizes that EBITDA, Adjusted EBITDA, and Hotel Adjusted EBITDA should not be considered as substitutes for net income or other performance measures under U.S. GAAP[92] - Nareit FFO attributable to stockholders is calculated by excluding depreciation, amortization, and gains or losses on asset sales, providing a clearer view of operating performance[93] - The Company believes that Nareit FFO offers useful insights for investors and facilitates performance comparisons across periods and REITs[94] - Adjusted FFO attributable to stockholders is presented to provide supplemental information regarding ongoing operating performance, excluding certain non-recurring items[95] - Net Debt is calculated as total debt minus cash and cash equivalents, providing a measure of financial leverage[98] - The Net Debt to Adjusted EBITDA ratio is frequently used by analysts to assess financial condition, though it should not replace U.S. GAAP measures[100] - Occupancy is defined as the total number of room nights sold divided by available room nights, serving as a key demand indicator[101] - Average Daily Rate (ADR) measures the average room price and is crucial for assessing pricing strategies and revenue generation[102] - Revenue per Available Room (RevPAR) combines occupancy and ADR, providing a comprehensive performance metric for hotel operations[103] - Total RevPAR includes all hotel revenues, indicating overall performance and revenue generation capabilities[104]

Core Viewpoint - Park Hotels & Resorts Inc. (NYSE: PK) is rated as a Hold for income-focused investors interested in real estate investment trusts (REITs), highlighting an attractive dividend yield but cautioning that the long-term risks may outweigh the benefits [1]. Summary by Relevant Sections - **Investment Perspective** - The company offers a very attractive dividend yield, appealing to income-focused investors [1]. - However, the long-term risks associated with owning this REIT may not justify the investment [1]. - **Analyst Background** - The analysis is provided by David A. Johnson, founder and principal of Endurance Capital Management, who has over 30 years of investment experience and holds advanced degrees in finance and business administration [1].

Financial Performance - Total revenues for the year ended December 31, 2024, were $2,599 million, a decrease of 3.7% compared to $2,698 million in 2023 [294]. - Net income attributable to stockholders for 2024 was $212 million, significantly up from $97 million in 2023, representing a 118.6% increase [294]. - Earnings per share (EPS) for 2024 were $1.02 (basic) and $1.01 (diluted), compared to $0.44 for both in 2023, marking a 131.8% increase in basic EPS [294]. - Operating income increased to $391 million in 2024, up from $343 million in 2023, reflecting a 14.0% growth [294]. - Net income for the year ended December 31, 2023, was $226 million, an increase from $106 million in 2022, representing a growth of approximately 113.2% [299]. - The company reported a net income of $196.3 million, representing a 1.9% increase from the previous year [408]. Assets and Liabilities - Total assets as of December 31, 2024, were $9,161 million, a decrease from $9,419 million in 2023 [292]. - Total liabilities decreased to $5,567 million in 2024 from $5,651 million in 2023, a reduction of 1.5% [292]. - Cash and cash equivalents at the end of 2024 were $402 million, down from $717 million in 2023, indicating a decrease of 44.0% [292]. - The company had total assets of $9,161 million as of December 31, 2024, down from $9,419 million in 2023 [397]. - The aggregate cost of real estate for U.S. federal income tax purposes was approximately $5,807 billion as of December 31, 2024 [412]. Debt and Financing - The Company has fixed-rate debt with a carrying value of $3,665 million and an average interest rate of 5.11% [258]. - Variable-rate debt amounts to $200 million, with an average interest rate of 6.21% [258]. - As of December 31, 2024, total debt amounted to $3.841 billion, an increase from $3.765 billion in 2023 [350]. - The HHV Mortgage Loan has a principal balance of $1.275 billion with an interest rate of 4.20% and matures in November 2026 [351]. - The 2024 Term Loan of $200 million bears an all-in interest rate of 6.21% and matures on May 14, 2027 [355]. - The contractual maturities of debt as of December 31, 2024, include $60 million due in 2025 and $1.55 billion due in 2026 [365]. Capital Expenditures and Investments - Capital expenditures for property and equipment in 2024 were $227 million, compared to $285 million in 2023, a decrease of 20.4% [296]. - The company had outstanding commitments of approximately $95 million for capital expenditures as of December 31, 2024 [397]. - The company acquired two parcels of land for approximately $18 million during the year ended December 31, 2023 [337]. Dividends and Shareholder Returns - Dividends paid in 2024 totaled $512 million, significantly higher than $152 million in 2023, reflecting a 236.8% increase [296]. - Dividends declared per common share were $1.40 for 2024, $2.15 for 2023, and $0.28 for 2022, indicating a significant increase in dividend payouts [299]. - The company repurchased 8 million shares of common stock for $116 million in 2023, compared to 15 million shares for $180 million in 2022 [299]. - Ordinary dividends per share for 2024 were $1.285731, with capital gain distributions of $0.114269 [379]. Impairment and Depreciation - The Company reported property and equipment, net of $7,398 million as of December 31, 2024, with an impairment loss of approximately $12 million recognized during the year [276]. - The company recognized impairment losses of approximately $12 million related to two hotels in 2024 and $202 million for one hotel in 2023 [345][346]. - Depreciation of property and equipment was $256 million in 2024, compared to $286 million in 2023 [344]. - Accumulated depreciation at the end of 2024 was $2,771 million, up from $2,620 million in 2023 [412]. Revenue Recognition and Operations - The company recognizes revenue primarily from room rentals, food and beverage sales, and ancillary services, with a focus on timely revenue recognition [326]. - Hotel Adjusted EBITDA for 2024 was $683 million, slightly down from $686 million in 2023, but up from $630 million in 2022 [395]. - The company achieved an occupancy rate of 80.2%, which is a 3.4% increase compared to the previous year [408]. Strategic Initiatives and Future Outlook - The company plans to continue operating as a Real Estate Investment Trust (REIT) to maintain tax advantages and optimize capital structure [302]. - Future guidance indicates an expected revenue growth of 5% to 7% for the next fiscal year, driven by increased travel demand [408]. - The company is investing in new technology to enhance guest experience, with a budget allocation of $50 million for the upcoming fiscal year [408]. - Park Hotels & Resorts Inc. plans to expand its portfolio by acquiring additional properties, targeting a growth of 10% in total assets over the next two years [408]. - The company is focusing on sustainability initiatives, aiming to reduce energy consumption by 15% over the next three years [408].