Ready to Jump After Recent Trade: Pebblebrook Hotel Trust (PEB)

Pebblebrook Hotel Trust (NYSE: PEB) stock fell -1.36% on Friday to $18.82 against a previous-day closing price of $19.08. With 1.45 million shares changed hands, the volume of the stock remained lighter than its average volume of 1.72 million shares. During the session, the REIT – Hotel & Motel company that operates in wider Real Estate sector, reached to the highest price of $19.53 whereas the lowest price it dropped to was $18.61. The 52-week range on PEB shows that it touched its highest point at $26.45 and its lowest point at $16.04 during that stretch. It currently has a 1-year price target of $24.25. With its current market cap of 2.40 billion, PEB has annualized dividend of $0.04 while the current yield stands at 0.21%. Beta for the stock currently stands at 1.78.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of PEB was down-trending over the past week, with a drop of -2.99%, but this was up by 12.90% over a month. Three-month performance dropped to -21.94% while six-month performance fell -13.79%. The stock lost -11.93% in the past year, while it has lost -15.87% so far this year. A look at the trailing 12-month EPS for PEB yields -1.47 with Next year EPS estimates of 0.30. For the next quarter, that number is 0.15. This implies an EPS growth rate of 44.70% for this year and 139.10% for next year. EPS is expected to grow by 9.00% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of -36.70%.

Float and Shares Shorts:

At present, 130.91 million PEB shares are outstanding with a float of 129.57 million shares on hand for trading. On Jul 14, 2022, short shares totaled 11.71 million, which was 8.94% higher than short shares on Jun 14, 2022. In addition to Mr. Jon E. Bortz CPA as the firm’s Chairman, Pres & CEO, Mr. Raymond D. Martz serves as its Exec. VP, CFO, Treasurer & Sec.

Institutional Ownership:

Through their ownership of 112.67% of PEB’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 60.02% of PEB, in contrast to 49.25% held by mutual funds. Shares owned by individuals account for 1.45%. As the largest shareholder in PEB with 14.63% of the stake, The Vanguard Group, Inc. holds 19,218,474 shares worth 19,218,474. A second-largest stockholder of PEB, BlackRock Fund Advisors, holds 14,879,025 shares, controlling over 11.33% of the firm’s shares. T. Rowe Price Associates, Inc. is the third largest shareholder in PEB, holding 8,188,388 shares or 6.23% stake. With a 4.61% stake in PEB, the Vanguard Real Estate Index Fund is the largest stakeholder. A total of 6,048,296 shares are owned by the mutual fund manager. The Vanguard Total Stock Market Index, which owns about 2.95% of PEB stock, is the second-largest Mutual Fund holder. It holds 3,868,924 shares valued at 64.11 million. iShares Core S&P Mid Cap ETF holds 2.87% of the stake in PEB, owning 3,768,965 shares worth 62.45 million.

An Overview of Recent Financials:

Understanding a company as a customer does not mean you will understand it as an investor. The wise investor uses quantitative research to analyze metrics such as revenue, net income, and earnings. In its fiscal quarter reported on Jun 29, 2022, PEB reported revenue of $397.52M and operating income of $64.22M. Over the past year, revenue came in at $1.14B while operating income stood at -$45.63M. It generated $27.99M net income for the quarter, which came to -$137.35M over the last twelve months. The EBITDA in the recently reported quarter was $122.34M and diluted EPS was $0.12. EBITDA for the full year was $252.30M.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for PEB since 13 analysts follow the stock currently. There are 3 analysts who recommend BUY ratings, while 0 suggest SELL ratings. Of the remaining analysts, 8 believe that the stock is worth HOLDING, 2 give it an OVERWEIGHT rating, and 0 thinks that it’s UNDERWEIGHT. In the same way, a target price assigned to a stock can also reveal much about its potential. With PEB analysts setting a high price target of $33.00 and a low target of $19.00, the average target price over the next 12 months is $24.17. Based on these targets, PEB could surge 75.35% to reach the target high and rise by 0.96% to reach the target low. Reaching the average price target will result in a growth of 28.43% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy. PEB will report FY 2022 earnings on 02/23/2023. Analysts have provided yearly estimates in a range of -$0.10 being high and -$0.55 being low. For PEB, this leads to a yearly average estimate of -$0.38. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. Pebblebrook Hotel Trust surprised analysts by -$0.01 when it reported $0.12 EPS against a consensus estimate of $0.13. The surprise factor in the prior quarter was -$0.32. Based on analyst estimates, the high estimate for the next quarter is $0.20 and the low estimate is $0.11. The average estimate for the next quarter is thus $0.15.

Summary of Insider Activity:

Insiders traded PEB stock several times over the past three months with 6 Buys and 0 Sells. In these transactions, 124,633 shares were bought while 0 shares were sold. The number of buy transactions has increased to 15 while that of sell transactions has risen to 3 over the past year. The total number of shares bought during that period was 251,232 while 40,429 shares were sold.

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