NEW YORK (
) has been upgraded by TheStreet Ratings from sell to hold. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, revenue growth and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including generally poor debt management, poor profit margins and a generally disappointing performance in the stock itself.
Highlights from the ratings report include:
- ASHFORD HOSPITALITY TRUST reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, ASHFORD HOSPITALITY TRUST continued to lose money by earning -$0.66 versus -$1.61 in the prior year. This year, the market expects an improvement in earnings ($1.80 versus -$0.66).
- Despite its growing revenue, the company underperformed as compared with the industry average of 17.2%. Since the same quarter one year prior, revenues rose by 14.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The gross profit margin for ASHFORD HOSPITALITY TRUST is currently extremely low, coming in at 6.60%. Despite the low profit margin, it has increased significantly from the same period last year. Despite the mixed results of the gross profit margin, AHT's net profit margin of -4.50% significantly underperformed when compared to the industry average.
- The debt-to-equity ratio is very high at 2.43 and currently higher than the industry average, implying that there is very poor management of debt levels within the company.
Ashford Hospitality Trust, Inc. is a publicly owned real estate investment trust. The firm engages in investment and management of properties in the hospitality industry. It invests in the real estate markets of the United States. Ashford has a market cap of $610.2 million and is part of the
industry. Shares are up 18.8% year to date as of the close of trading on Friday.
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-- Written by a member of TheStreet RatingsStaff