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Summit Hotel Properties (INN)
NYSE:INN
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Summit Hotel Properties
(NYSE:INN)
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Rating:68Neutral
Price Target:
$6.00
▲(8.50% Upside)
Summit Hotel Properties shows strong financial management and cash flow generation, which are significant strengths. Technical indicators suggest a positive short-term trend, but valuation concerns due to negative earnings impact the score. The earnings call provided a balanced view of effective strategies and demand challenges, contributing to a moderate overall score.
Summit Hotel Properties (INN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$673.65M
Dividend Yield5.79%
Average Volume (3M)782.57K
Price to Earnings (P/E)41.2
Beta (1Y)1.35
Revenue Growth-1.91%
EPS Growth-256.67%
CountryUS
Employees85
SectorReal Estate
Sector Strength53
IndustryREIT - Hotel & Motel
Share Statistics
EPS (TTM)-0.02
Shares Outstanding108,808,784
10 Day Avg. Volume786,213
30 Day Avg. Volume782,567
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap3.54
Enterprise Value/Revenue3.28
Enterprise Value/Gross Profit11.07
Enterprise Value/Ebitda10.70
Forecast
1Y Price Target
$5.88Price Target Upside6.33% Upside
Rating ConsensusHold
Number of Analyst Covering2
Summit Hotel Properties Business Overview & Revenue Model
Company DescriptionSummit Hotel Properties, Inc. is a publicly traded real estate investment trust focused on owning premium-branded hotels with efficient operating models primarily in the Upscale segment of the lodging industry. As of November 3, 2020, the Company's portfolio consisted of 72 hotels, 67 of which are wholly owned, with a total of 11,288 guestrooms located in 23 states.
How the Company Makes MoneySummit Hotel Properties generates revenue primarily through the operation and leasing of its hotel properties, which are managed by reputable hotel brands. The company earns rental income from its hotel leases, which typically involve long-term agreements with established hotel operators. Additionally, it may benefit from incentive management fees tied to the performance of the hotels. Revenue streams are further supplemented by ancillary services offered within the hotels, such as food and beverage sales and other guest services. The company's strategic focus on premium branded hotels in high-demand markets allows it to capitalize on both occupancy rates and average daily rates (ADR), enhancing its overall profitability. Furthermore, partnerships with leading hotel brands and management companies contribute to its operational efficiency and brand recognition, which are vital in attracting guests and maintaining high occupancy levels.
Summit Hotel Properties Earnings Call Summary
Earnings Call Date:Aug 05, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 04, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted effective cost management, market share growth, and successful refinancing efforts. However, it also addressed challenges such as RevPAR decline, weaker government and international demand, and market-specific difficulties. The positives, including strong expense management and strategic financial maneuvers, were counterbalanced by significant revenue and demand challenges.Q2-2025 Updates
Positive Updates
Successful Share Repurchase Program
Summit Hotel Properties repurchased 3.6 million shares for $15.4 million, with an average price of $4.30 per share. This represents a discount of 15% to the current trading price and reduced shares outstanding by approximately 3%.
Strong Expense Management
Operating expenses increased only 1.5% year-over-year or 2% on a per occupied room basis. Year-to-date, expenses have increased modestly by 1.5%, limiting EBITDA margin contraction to 160 basis points.
Refinancing and Debt Management
The company refinanced a $58 million mortgage with a 40 basis point reduction in spread and a $400 million term loan with a 50 basis point reduction. This refinancing led to estimated annual interest savings of approximately $2 million.
Market Share Growth
RevPAR index grew by nearly 150 basis points to 115%, among the highest post-pandemic levels, reflecting effective revenue strategies.
Negative Updates
RevPAR Decline
Same-store RevPAR declined 3.6%, influenced by a 3.3% decline in average daily rate and a shift to lower-rated segments. April, May, and June saw RevPAR declines of 4.4%, 3.9%, and 2.6% respectively.
Government and International Demand Weakness
Government-related demand, representing 5% to 7% of total room nights, declined over 20% year-over-year. Net inbound international travel fell approximately 18% from the second quarter of last year.
Challenging Market Conditions in Key Areas
Dallas, Atlanta, Phoenix, and New Orleans experienced greater RevPAR contraction than the overall portfolio, influenced by renovation displacement and tough year-over-year comparisons.
Company Guidance
During the second quarter of 2025, Summit Hotel Properties, Inc. reported a decline in same-store RevPAR by 3.6%, falling within their expected range of a 2% to 4% decline. This was largely driven by a 3.3% decrease in average daily rate and a less than 0.5% decline in occupancy, which stood at 78%, marking their second-highest nominal occupancy in the past five years. The company faced significant year-over-year comparisons due to high-rated events in 2024 and a 125 basis point headwind to RevPAR growth from these events. Government-related demand contracted by over 20%, and net inbound international travel declined by approximately 18%. Despite these challenges, Summit managed to improve market share, with a RevPAR index increase of nearly 150 basis points to 115%, and limited operating expense growth to 1.5% year-over-year, maintaining EBITDA margins with minimal contraction. Additionally, the company executed a $50 million share repurchase program, buying back 3.6 million shares at an average price of $4.30, which enhanced their cash flow profile by offering a 7.4% implied dividend yield. Looking ahead, Summit expects RevPAR declines to moderate in the third quarter, projecting a 3% decline and is optimistic about improvements in the fourth quarter due to demand stabilization and macroeconomic clarity.Summit Hotel Properties Financial Statement Overview
Summary
Summit Hotel Properties displays a strong financial profile with improvements in profitability and cash flow generation. While revenue growth has been modest, the company has effectively managed costs and leverage, resulting in stable margins and a solid balance sheet. The overall financial health is robust, reflecting a well-managed financial strategy in the REIT - Hotel & Motel industry.Income Statement
Summit Hotel Properties shows a stable gross profit margin and has improved its net profit margin significantly from negative in previous years to a positive 5.64% TTM. Revenue growth has been moderate, with a slight decline in recent periods. The EBIT and EBITDA margins are healthy, indicating effective cost management and operational efficiencies.75
Positive
Balance Sheet
The company maintains a reasonable debt-to-equity ratio of 1.57, suggesting balanced leverage. Return on equity is modest at 4.46% TTM, reflecting improved profitability. The equity ratio stands at 31.78%, indicating a solid equity base to support assets. Overall, the balance sheet reflects stability with manageable debt levels.70
Positive
Cash Flow
The operating cash flow to net income ratio is strong, demonstrating robust cash generation relative to net income. Free cash flow has improved significantly, showcasing effective capital expenditure management. The free cash flow to net income ratio indicates solid cash conversion, highlighting the company's capability to generate cash from operations.80
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 727.13M | 731.78M | 736.13M | 675.70M | 361.93M | 234.46M |
| Gross Profit | 215.31M | 259.64M | 258.02M | 255.90M | 117.31M | 34.07M |
| EBITDA | 222.86M | 227.74M | 212.40M | 208.05M | 83.07M | 1.98M |
| Net Income | 8.61M | 43.64M | -9.49M | 1.47M | -68.58M | -149.25M |
Balance Sheet | ||||||
| Total Assets | 2.87B | 2.90B | 2.94B | 3.02B | 2.26B | 2.23B |
| Cash, Cash Equivalents and Short-Term Investments | 2.76B | 52.21M | 51.80M | 51.26M | 64.48M | 20.72M |
| Total Debt | 0.00 | 1.42B | 1.46B | 1.69B | 1.09B | 1.11B |
| Total Liabilities | 1.54B | 1.51B | 1.54B | 1.56B | 1.16B | 1.18B |
| Stockholders Equity | 895.15M | 909.54M | 911.20M | 959.81M | 948.07M | 988.74M |
Cash Flow | ||||||
| Free Cash Flow | 202.45M | 166.32M | 64.06M | 93.15M | 45.70M | -64.68M |
| Operating Cash Flow | 162.53M | 166.32M | 153.64M | 169.62M | 66.05M | -42.05M |
| Investing Cash Flow | -161.26M | -71.50M | -101.96M | -290.51M | -74.24M | -30.71M |
| Financing Cash Flow | -5.54M | -94.23M | -65.72M | 85.76M | 66.24M | 41.83M |
Summit Hotel Properties Technical Analysis
Positive
5.53
Price Trends
5.44
Positive
5.10
Positive
5.35
Positive
Market Momentum
0.04
Positive
47.19
Neutral
12.02
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For INN, the sentiment is Positive. The current price of 5.53 is below the 20-day moving average (MA) of 5.69, above the 50-day MA of 5.44, and above the 200-day MA of 5.35, indicating a neutral trend. The MACD of 0.04 indicates Positive momentum. The RSI at 47.19 is Neutral, neither overbought nor oversold. The STOCH value of 12.02 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for INN.
Summit Hotel Properties Risk Analysis
Summit Hotel Properties disclosed 71 risk factors in its most recent earnings report. Summit Hotel Properties reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Summit Hotel Properties Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $1.30B | 21.61 | 5.18% | 3.98% | 4.81% | 185.08% | |
68 Neutral | $673.65M | 41.24 | 0.93% | 5.79% | -1.91% | -256.67% | |
61 Neutral | $323.75M | 253.21 | 1.24% | 5.14% | -0.87% | ― | |
58 Neutral | $183.51M | -3.51 | -0.08% | 7.43% | -3.68% | 38.92% | |
49 Neutral | $444.92M | -1.59 | -32.34% | 1.50% | -0.23% | -38.68% | |
42 Neutral | $36.49M | -0.12 | 82.36% | ― | -11.83% | -4186.83% | |
65 Neutral | $2.17B | 12.19 | 3.79% | 4.94% | 3.15% | 1.96% |
* Real Estate Sector Average
INN
Summit Hotel Properties
5.53
-1.04
-15.83%
SVC
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2.67
-1.91
-41.70%
CLDT
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6.61
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-18.29%
RLJ
RLJ Lodging
7.22
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-16.63%
BHR
Braemar Hotels & Resorts
2.69
-0.19
-6.60%
XHR
Xenia Hotels & Resorts
13.57
-0.95
-6.54%
Summit Hotel Properties Corporate Events
Private Placements and FinancingBusiness Operations and Strategy
Summit Hotel Properties Secures $400 Million Credit Facility
Neutral
Jul 28, 2025
On July 24, 2025, Summit JV MR 2, LLC and its affiliates entered into a $400 million credit facility with several lenders, including Bank of America and Wells Fargo, to support their operations. The facility, which can be increased to $600 million, is secured by equity interests in subsidiaries holding borrowing base assets and includes various financial covenants and conditions, impacting the company’s financial flexibility and operational strategy.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.