Continuing to follow you, cwillyg. Sold more AHT $3.90. A loss on that batch.
I'm still wrestling with SPPR. This is where I am trying to get a grip: A buyer of the stock at current price is sort-of saying, that on average he/or she is willing to buy a hotel with these figures:
For an 87-room hotel, which is operating at 57% occupancy, buy it by putting up cash of $282,000 and assuming a mortgage of $1.6M. Book value of the property is $2.4M. The property last quarter generated $8770 in FFO. Annualize that (recognizing there'll possibly be --or likely be-- big q vs. q changes), and the person gets annually $35,000. (And recognize it's not AFFO, but FFO). If it were a real deal and I was an interested buyer, I might very well go for it as a sole proprietorship. I'd get about 12% ($35K) on my $282K cash in; I'd put my family in a couple of the available rooms; I'd get tax advantages (write-offs), and over time, I'd expect to pay down the mortgage and maybe increase revpar (now $47) or occupancy rate. This is what lots of people, esp. immigrants do here, right?-- buy themselves a little business.
Now though as just a buyer of SPPR the public company, I am hesitant. Possibly because I don't know the business aspects and don't really know how to judge value here.
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SPPR: 122 properties and 10659 rooms. Market cap = $34M. 34/122= $282,000. Ltd per quarterly report = $192M. 192/122 = $1.6M per property on average. "Investments in hotel properties Less accumulated depreciation" is $296M. 296/122 = $2.4M.
FFO latest quarter = $1.07M = $8770 per ea. 122 properties. |
