I spent Memorial Day weekend with the family at a Sonesta
If you're a hotel operator, it's not a bad time to cash out. Four Seasons was taken private earlier this year. Motley Fool Hidden Gems recommendation Fairmont was taken out at a healthy premium last year. Meanwhile, you have small chains like boutique operator Morgans
Then again, many of the hoteliers are considered asset plays. You won't find too many cheap hospitality stars with low P/E ratios. Wyndham
If Sonesta can capitalize on favorable industry trends, a brave suitor may be willing to overlook the company's shortcomings. Believe me, Sonesta has them. It hasn't posted an annual operating profit since 2004. The company also released a rather bleak first-quarter report last month, as the closure of one of its properties in Key Biscayne, Florida, led to a 28% top-line decline. The property will be redeveloped, but that's what happens when you manage most of your resorts and have ownership stakes in just a few of them.
Sonesta should have plenty of bidders, warts and all, if yesterday's 33% stock spike is any indication. Hilton
Fairmont is a former Hidden Gems newsletter pick. It was acquired at a healthy premium last year. See if there are any other buried stock treasures worth uncovering before private equity bids them up with a free 30-day trial subscription.
Longtime Fool contributor Rick Munarriz has stayed at a few Sonesta resorts in his time. Despite the lumpy financials, he raves about the chain. He does not own shares in any of the stocks in this story. Rick is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.
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