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Pebblebrook Hotel Trust (PEB)

Pebblebrook Hotel Trust is a publicly traded real estate investment trust organized in December 2009 to opportunistically acquire and invest in upper upscale, full service hotel and resort properties located in or near urban markets in major United States gateway cities.

Company profile

Ticker
PEB, PEB+G, PEB+H
Exchange
CEO
Jon Bortz
Employees
Incorporated
Location
Fiscal year end
SEC CIK
Subsidiaries
Pebblebrook Hotel, L.P. • Pebblebrook Hotel Lessee, Inc. • Huskies Owner LLC • Huskies Lessee LLC • Orangemen Owner LLC • Orangemen Lessee LLC • Gator Owner LLC • Gator Lessee LLC • Jayhawk Owner LLC • Jayhawk Lessee LLC ...
IRS number
271055421

PEB stock data

Analyst ratings and price targets

Last 3 months
Current price
Average target
$21.00
Low target
$20.00
High target
$22.00
Wells Fargo
Downgraded
Equal-Weight
$20.00
29 Aug 22
Barclays
Maintains
Equal-Weight
$22.00
7 Jul 22

Investment data

Data from SEC filings
Securities sold
Number of investors

Calendar

26 Jul 22
1 Oct 22
31 Dec 22
Quarter (USD) Jun 22 Mar 22 Dec 21 Sep 21
Revenue
Cost of revenue
Operating income
Operating margin
Net income
Net profit margin
Cash on hand
Change in cash
Diluted EPS
Annual (USD) Dec 21 Dec 20 Dec 19 Dec 18
Revenue
Cost of revenue
Operating income
Operating margin
Net income
Net profit margin
Cash on hand
Change in cash
Diluted EPS
Cash burn rate (est.) Burn method: Change in cash Burn method: Operating income Burn method: FCF (opex + capex)
Last Q Avg 4Q Last Q Avg 4Q Last Q Avg 4Q
Cash on hand (at last report) 62.79M 62.79M 62.79M 62.79M 62.79M 62.79M
Cash burn (monthly) 11.05M 21.69M (no burn) 9.55M (no burn) (no burn)
Cash used (since last report) 33.79M 66.29M n/a 29.2M n/a n/a
Cash remaining 29M -3.5M n/a 33.59M n/a n/a
Runway (months of cash) 2.6 -0.2 n/a 3.5 n/a n/a

Beta Read what these cash burn values mean

Date Owner Security Transaction Code Indirect 10b5-1 $Price #Shares $Value #Remaining
27 Sep 22 Phillip M. Miller Common Shares Sell Dispose S No No 14.83 5,200 77.12K 19,953
30 Jun 22 Ron E. Jackson Common Shares Buy Acquire P No No 16.86 5,900 99.47K 61,122
30 Jun 22 Bortz Jon E Common Shares Buy Acquire P No No 16.668 16,000 266.69K 1,006,830
29 Jun 22 Bortz Jon E Common Shares Buy Acquire P No No 16.33 10,000 163.3K 990,830
16 May 22 Bortz Jon E Common Shares Grant Acquire A No No 0 49,933 0 980,830
16 May 22 Fisher Thomas Charles Common Shares Grant Acquire A No No 0 21,400 0 190,027
13F holders Current Prev Q Change
Total holders 260 250 +4.0%
Opened positions 43 36 +19.4%
Closed positions 33 25 +32.0%
Increased positions 92 97 -5.2%
Reduced positions 88 81 +8.6%
13F shares Current Prev Q Change
Total value 2.49B 3.57B -30.4%
Total shares 152.08M 150.77M +0.9%
Total puts 10.4K 0 NEW
Total calls 20.2K 11.9K +69.7%
Total put/call ratio 0.5
Largest owners Shares Value Change
Vanguard 19.29M $319.59M -1.3%
BLK Blackrock 17.76M $294.33M +0.4%
TROW T. Rowe Price 8.82M $146.23M +7.8%
STT State Street 7.94M $131.63M -0.2%
Wellington Management 6.53M $108.26M +0.4%
Earnest Partners 5.98M $99.15M -3.3%
Goldman Sachs Asset Management 5.45M $0 0.0%
Daiwa Asset Management 4.9M $138.62M 0.0%
SAMG Silvercrest Asset Management 4.66M $77.29M -0.3%
PFG Principal Financial Group Inc - Registered Shares 3.82M $63.32M +25.5%
Largest transactions Shares Bought/sold Change
APG Asset Management US 0 -1.67M EXIT
MS Morgan Stanley 1.17M +869.56K +287.7%
PFG Principal Financial Group Inc - Registered Shares 3.82M +776.24K +25.5%
GS Goldman Sachs 3.13M -761.62K -19.6%
Capital Growth Management 0 -700K EXIT
Nuveen Asset Management 897.5K -662.34K -42.5%
Millennium Management 938.22K +661.15K +238.6%
TROW T. Rowe Price 8.82M +636.46K +7.8%
Point72 Asset Management 530.41K +530.41K NEW
Parametric Portfolio Associates 0 -506.67K EXIT

Financial report summary

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Risks
  • We depend on the efforts and expertise of our executive officers and would be adversely affected by the loss of their services.
  • Our returns could be negatively impacted if the third-party management companies that operate our hotels do not manage our hotel properties effectively.
  • Due to our exclusive focus on hotels and resorts, and our concentration in hotel investments primarily in major gateway urban and resort markets, a downturn in the lodging industry generally or regional downturns in the markets in which we operate would adversely affect our operations and financial condition.
  • If we cannot obtain financing, our growth will be limited.
  • Our ability to make distributions to our shareholders is subject to fluctuations in our financial performance, operating results and capital improvements requirements.
  • We may pay taxable distributions in cash and our common shares, in which case shareholders may sell their common shares to pay tax on such distributions, placing downward pressure on the market price of our common shares.
  • Restrictive covenants in our management contracts could preclude us from taking actions with respect to the sale or refinancing of a hotel property that would otherwise be in our best interest.
  • We invest primarily in the upper-upscale segment of the lodging market, which is highly competitive and generally subject to greater volatility than most other market segments and could negatively affect our profitability.
  • Our TRS lessee structure subjects us to the risk of increased hotel operating expenses.
  • Our hotels operated under franchise agreements are subject to risks arising from adverse developments with respect to the franchise brand and to costs associated with maintaining the franchise license.
  • Any joint venture investments that we may make in the future could be adversely affected by our lack of sole decision-making authority, our reliance on our co-venturers' financial condition and disputes between us and our co-venturers.
  • Our senior executive officers have broad discretion to make investments, and they may make investments where the returns are substantially below expectations or which result in net operating losses.
  • Some of our hotels are subject to rights of first offer which may adversely affect our ability to sell those properties on favorable terms or at all.
  • The purchase or sale of properties we put under contract may not be consummated.
  • Our cash and cash equivalents are maintained in a limited number of financial institutions and the funds in those institutions may not be fully or federally insured.
  • Our conflicts of interest policy may not adequately address all of the conflicts of interest that may arise with respect to our activities.
  • Debt service obligations could adversely affect our overall operating results, may require us to sell hotel properties, may jeopardize our qualification as a REIT and could adversely affect our ability to make distributions to our shareholders and the market price of our common shares.
  • Our existing indebtedness contains financial covenants that could limit our operations and our ability to make distributions to our shareholders.
  • Our existing mortgage loan agreements contain, and mortgage loan agreements we may enter into in the future may contain, “cash trap” provisions that could limit our ability to make distributions to our shareholders.
  • There is refinancing risk associated with our debt.
  • If we default on our secured debt, the lenders may foreclose on our hotels.
  • Acquiring outstanding debt secured by a hotel or resort property may expose us to risks of costs and delays in acquiring the underlying property.
  • Changes in the method of determining the LIBOR, or the replacement of LIBOR with an alternative reference rate, may adversely affect our financial results.
  • The COVID-19 pandemic has had, and is expected to continue to have, a material adverse impact on our financial condition, results of operations, cash flows, liquidity and prospects. The current, and uncertain future, impact of the COVID-19 pandemic, including its effect on the ability or desire of people to travel for leisure or for business, is expected to continue to adversely impact our financial condition, results of operations, cash flows, liquidity and prospects.
  • Economic conditions may reduce demand for hotel properties and adversely affect hotel profitability.
  • Our operating results and ability to make distributions to our shareholders may be adversely affected by various operating risks common to the lodging industry.
  • Competition for acquisitions may reduce the number of properties we can acquire.
  • The seasonality of the lodging industry may cause fluctuations in our quarterly revenues that cause us to borrow money to fund distributions to our shareholders.
  • The cyclical nature of the lodging industry may cause the returns from our investments to be less than we expect.
  • Capital expenditure requirements at our properties may be costly and require us to incur debt, postpone improvements, reduce distributions or otherwise adversely affect the results of our operations and the market price of our common shares.
  • Hotel and resort development and redevelopment is subject to timing, budgeting and other risks that may adversely affect our financial condition, results of operations, the market price of our common shares and our ability to make distributions to our shareholders.
  • The increasing use by consumers of Internet travel intermediaries and alternative lodging marketplaces may reduce our revenues.
  • We may be adversely affected by increased use of business-related technology which may reduce the need for business-related travel.
  • Our hotel managers and we rely on information technology in our operations, and any material failure, inadequacy, interruption or security failure of that technology could harm our business.
  • We are subject to risks associated with the employment of hotel personnel, particularly with hotels that employ unionized labor.
  • Terrorist attacks or changes in terror alert levels could adversely affect travel and hotel demand.
  • We face risks associated with natural disasters and the direct and indirect physical effects of climate change, which may include more frequent and more severe storms, hurricanes, flooding, droughts and wildfires, any of which could have a material adverse effect on our hotel properties, operations, cash flows and financing options.
  • Uninsured and underinsured losses could result in a loss of capital.
  • Our hotels may be subject to unknown or contingent liabilities which could cause us to incur substantial costs.
  • Noncompliance with environmental laws and regulations could subject us to fines and liabilities which could adversely affect our operating results.
  • Our hotel properties may contain or develop harmful mold, which could lead to liability for adverse health effects and costs of remediating the problem.
  • Compliance with the Americans with Disabilities Act could require us to incur substantial costs.
  • The nature of the operations of our hotels exposes us to the risk of claims and litigation that may arise in the normal course of business.
  • Illiquidity of real estate investments could significantly impede our ability to sell hotels or otherwise respond to adverse changes in the performance of our hotel properties.
  • If states and localities in which we own material amounts of property or conduct material amounts of business raise their income and property tax rates or amend their tax regimes in a manner that increases our state and local tax liabilities, we would have less cash available for distribution to our shareholders and the market price of our shares could be adversely affected.
  • The costs of compliance with or liabilities under environmental laws could significantly reduce our profitability.
  • Provisions of our declaration of trust may limit the ability of a third party to acquire control of us by authorizing our board of trustees to authorize issuances of additional securities.
  • Provisions of Maryland law may limit the ability of a third party to acquire control of us by requiring our board of trustees or shareholders to approve proposals to acquire our company or effect a change of control.
  • The ownership limitations in our declaration of trust may restrict or prevent shareholders from engaging in certain transfers of our common shares.
  • Our rights and the rights of our shareholders to take action against our trustees and officers are limited, which could limit shareholders' recourse in the event of actions not in their best interests.
  • Our declaration of trust contains provisions that make removal of our trustees difficult, making it difficult for our shareholders to effect changes to our management.
  • The ability of our board of trustees to change our major policies without the consent of shareholders may not be in shareholders' interest.
  • Further issuances of equity securities may be dilutive to current shareholders.
  • Future offerings of debt securities or preferred shares, which would be senior to our common shares upon liquidation and for the purpose of distributions, may cause the market price of our common shares to decline.
  • Holders of our outstanding preferred shares have dividend, liquidation and other rights that are senior to the rights of the holders of our common shares.
  • The change of control conversion and redemption features of the Series E Preferred Shares, the Series F Preferred Shares, the Series G Preferred Shares and the Series H Preferred Shares, may make it more difficult for a party to take over our company or discourage a party from taking over our company.
  • We have entered into an agreement with each of our executive officers that requires us to make payments in the event the officer's employment is terminated by us without cause, by the officer for good reason or under certain circumstances following a change of control of our company.
  • If we fail to maintain an effective system of internal controls, we may not be able to accurately determine our financial results or prevent fraud. As a result, our shareholders could lose confidence in our financial results, which could harm our business and the value of our common shares.
  • Our failure to maintain our qualification as a REIT would result in higher taxes and reduced cash available for distribution to our shareholders.
  • We could face adverse tax consequences if LaSalle failed to qualify as a REIT prior to the merger.
  • Complying with REIT requirements may cause us to forego otherwise attractive business opportunities or liquidate otherwise attractive investments.
  • To maintain our qualification as a REIT and avoid corporate income tax and excise tax, we must distribute annually a certain percentage of our REIT taxable income, which could require us to raise capital on terms or sell properties at prices or at times that are unfavorable.
  • We may pay taxable dividends partly in shares and partly in cash, in which case shareholders may sell our shares to pay tax on such dividends, placing downward pressure on the market price of our shares.
  • Our TRS lessees increase our overall tax liability.
  • Our ownership of our TRSs is limited and our transactions with our TRSs will cause us to be subject to a 100 percent penalty tax on certain income or deductions if those transactions are not conducted on arm's-length terms.
  • If the leases of our hotel properties to our TRS lessees are not respected as true leases for U.S. federal income tax purposes, we would fail to qualify as a REIT and would be subject to higher taxes and have less cash available for distribution to our shareholders.
  • If our Operating Partnership failed to qualify as a partnership for U.S. federal income tax purposes, we would cease to qualify as a REIT and would be subject to higher taxes and have less cash available for distribution to our shareholders and suffer other adverse consequences.
  • If our TRSs fail to qualify as TRSs for U.S. federal income tax purposes or our hotel managers do not qualify as “eligible independent contractors,” we would fail to qualify as a REIT.
  • Dividends payable by REITs do not qualify for the reduced tax rates available for some dividends.
  • Complying with REIT requirements may limit our ability to hedge our liabilities effectively and may cause us to incur tax liabilities.
  • If our subsidiary REITs failed to qualify as REITs, we could be subject to higher taxes and could fail to remain qualified as REITs.
  • The ability of our board of trustees to revoke our REIT qualification without shareholder approval may subject us to U.S. federal and state income tax and reduce distributions to our shareholders.
  • The share ownership restrictions of the Code for REITs and the 9.8 percent share ownership limit in our declaration of trust may inhibit market activity in our shares and restrict our business combination opportunities.
  • The prohibited transactions tax may limit our ability to engage in transactions, including dispositions of assets that would be treated as sales for U.S. federal income tax purposes.
  • We may be subject to adverse legislative or regulatory tax changes that could increase our tax liability, reduce the tax benefits of our REIT structure compared to non-REIT corporations, reduce our operating flexibility and reduce the market price of our shares.
Management Discussion
  • At June 30, 2022 and 2021, we had 54 and 51, respectively, wholly owned properties and leasehold interests. All properties owned during these periods have been included in our results of operations during the respective periods since their dates of acquisition and through the dates of disposition, as applicable. Based on when a property was acquired or disposed, operating results for certain properties are not comparable for the three and six months ended June 30, 2022 and 2021. The properties listed in the table below are hereinafter referred to as "non-comparable properties" for the periods indicated and all other properties are referred to as "comparable properties":
  • Revenues — Total hotel revenues increased by $234.2 million, of which $50.7 million was due to non-comparable properties, and the balance was primarily due to an increase in leisure travel demand during the spring and summer travel season, as well as some recoveries in business and group bookings.
  • Hotel operating expenses — Total hotel operating expenses increased by $121.2 million, of which $29.2 million was due to non-comparable properties, and the balance was primarily due to resuming operations at our comparable properties and returning demand in the second quarter of 2022.

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