This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

IPO Watch: 2011

Summit Hotel Properties

IPO Filing Date: Aug. 9, 2010

Expected IPO Date: Feb. 7, 2011



Amount of Proceeds Sought: $264.5 million

Expected Offering Price: $10.50 to $12.50

Expected Number of Shares to Be Sold: 23 million

Use of Proceeds: To eliminate certain debt covenants, to fund improvements at its hotels and for general corporate and working capital purposes, including potential hotel acquisitions.



Expected Ticker Symbol: INN (INN) (NYSE)



Lead Underwriters: Deutsche Bank Securities, Baird and RBC Capital Markets

Co-Managers: KeyBanc Capital Markets, Morgan Keegan



About the Company: Summit Hotel Properties is a hotel investment company that was recently organized to continue and expand the existing hotel investment business of its predecessor, Summit Hotel Properties, LLC.

The predecessor focused on upscale and midscale hotels. Summit Hotel Properties said it wants to continue its predecessor's business of acquiring, owning, renovating, repositioning and aggressively managing hotel assets throughout the U.S.

The majority of Summit's hotels operate under franchise brands owned by Marriott International (MAR), Hilton Worldwide, InterContinental Hotels Group (IHG) and Hyatt (H) Hotels and Resorts. Since Jan. 1, 2007, Summit has invested about $305 million in acquisitions and upgrades at its hotels.

About $10 million of net proceeds from the initial public offering will be used to make additional improvements to Summit's hotels.

The company posted total revenue of $121.2 million in 2009 compared with $135.1 million in 2008 and $113.9 million in 2007.

Summit Hotel Properties reported net loss of $15.1 million in 2009 compared with net income of $13.1 million in 2008 and $14 million in 2007.

One of the company's key business risks is that it has a significant amount of debt. Furthermore, certain debt covenants that Summit Hotel has agreed upon may reduce the operational flexibility of the company and its subsidiaries, increasing default risks.

IPO Scorecard:



Actual IPO Date: Feb. 9, 2011

Actual Proceeds Raised: $ 254 million

Actual Offering price: $9.75

Actual Number of Shares Sold: 26 million



First Day Closing Price: $9.69

IPO First Day Return: -0.6%

3 of 9

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 18,030.21 +6.04 0.03%
S&P 500 2,081.88 -0.29 -0.01%
NASDAQ 4,773.4720 +8.0480 0.17%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs