Ashford Hospitality: Get Rich While Waiting for a Rebound (AHT)

Perhaps my favorite hotel real estate investment trust is Ashford Hospitality Trust (AHT). For around 10 years, this public REIT has been repeatedly knocking the cover off the ball, but the market has rarely gotten around to valuing AHT stock properly. I’m not sure what the deficiency is, other than that Ashford Hospitality may not have some big, flashy name. Yet when you examine all the metrics and note that Ashford’s management has been in the hotel business for 25 years, through all the booms and busts, there is simply no reason for AHT stock to be trading at its current bargain price

So I suggest jumping into Ashford shares and collecting the 6% yield while the stock catches up to fair value. Ashford makes a good number of deals in the hotel business. Because of management’s acumen, AHT is able to manage operations that align with market conditions and maximize its margins. Management was particularly adept at handling the financial crisis in 2008 and beyond by proactively drawing down lines of credit and using interest rate hedges to generate additional income during a period when the hotel industry saw revenue declines of more than 15%.

Source: InvestorPlace

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