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Why Shares of Ashford Hospitality Trust Are Up Today

By Bram Berkowitz - May 25, 2021 at 12:01PM

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A strategic update on its future direction and earnings projections helped lift the stock.

What happened

Shares of Ashford Hospitality Trust (AHT 3.14%) were trading 10.6% higher as of 11:20 a.m. EDT today, after the company's advisor posted an investor presentation that provided strategic updates.

So what

Ashford Hospitality Trust is a real estate investment trust (REIT) that primarily invests in upscale hotels. The company is advised by Ashford Inc. (AINC -1.77%), which also advises another REIT called Braemar Hotels & Resorts (BHR 0.83%).

Recently, Ashford Inc. released a new investor presentation that describes four ways it can grow: with a recovery of the hospitality industry, an increase in assets under management, growth in third-party businesses, and the acquisition or incubation of new businesses.

Two people with luggage outside the entrance of hotel.

Image source: Getty Images.

Ashford Inc. is also projecting to grow earnings before interest, taxes, depreciation, and amortization (EBITDA) from $29 million in 2020 to $54 million by 2025, with the potential to reach $84 million, depending on how growth goes.

Now what

Ashford Hospitality Trust got dinged up pretty badly during the pandemic, with hotels and the hospitality sector being one of the hardest hit industries, experiencing extremely low occupancy rates. But with vaccines being distributed and coronavirus cases on the decline, the sector is looking to recover.

There might still be a little bit of uncertainty with the virus and the pandemic, but the hotel sector is looking much better. As fewer people are worried about the virus, they plan to start traveling again, which should bode well for Ashford Hospitality Trust.

Bram Berkowitz has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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Stocks Mentioned

Ashford Hospitality Trust, Inc. Stock Quote
Ashford Hospitality Trust, Inc.
AHT
$11.51 (3.14%) $0.35
Ashford Inc. Stock Quote
Ashford Inc.
AINC
$17.23 (-1.77%) $0.31
Braemar Hotels & Resorts, Inc. Stock Quote
Braemar Hotels & Resorts, Inc.
BHR
$5.49 (0.83%) $0.04

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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