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TheStreet Open House

5 REITs to Rally on Home Sales (Corrected)

Stocks in this article: SPG TWO ARE DEI HT

1. Hersha Hospitality (HT - Get Report) is a self-advised REIT with a market cap exceeding $768 million. The company owns interests in 79 hotels totaling 10,689 rooms, primarily in major cities along the Northeast Corridor running from Boston to Washington, D.C.

Of the 14 analysts covering the stock, 71% recommended a buy and 29% suggest a hold. Analysts' average 12-month price target for the stock is $5.52, about 19.3% higher than the current levels, according to data compiled by Bloomberg.

For 2011 third quarter, HT reported total revenue of $80.8 million, up 17% from $69.1 million in the same quarter last year. Consolidated revenue per available room improved 8.3% to $127.40, vs. $117.64 in the prior-year period. The average daily rate for its consolidated hotels increased 6.9% to $157.94, while occupancy for the same grew 104 basis points to 80.66%.

The company paid quarterly cash dividend of 50 cents per series A and B preferred shares and 6 cents per common share and per limited partnership unit. The company sees 2011 total consolidated revenue per available room in the 7% to 8% range.

Through the third quarter, the company spent $2.7 million of the anticipated $4.5 million as development cost of a hotel redevelopment project, which is expected to complete by the end of the first quarter of 2012. Hersha has entered into an agreement to sell 18 non-core hotels for approximately $155 million and generate net cash proceeds of approximately $54.4 million from the sale.

Recently, the company announced a purchase contract to acquire the 263 rooms of Courtyard Miami Beach Oceanfront and an adjacent beachfront land parcel for $95.0 million.

>>To see these stocks in action, visit the 5 REITs to Rally on Home Sales portfolio on Stockpickr.

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