US hotel stocks slid 0.8% in October

US hotel stocks slid 0.8% in October

US hotel stocks slid 0.8% in October US hotel stocks, as indicated by the Baird/STR Index, went into negative growth territory by 0.8% in October to close at 3,108 points. However, the index has maintained a year to date growth rate of 0.4%, according to a report published by Hotel News Resource.

"Calendar shifts and subsequent strong RevPAR (revenue per available room) growth helped stocks, but October prices would indicate that investors were more focused on a pending deceleration in performance," said Amanda Hite, STR's president and chief executive in the report.

"Supply growth and demand growth are in equilibrium, and we expect softening occupancy to eventually turn to an occupancy decline in 2017. At the same time, rate will still push moderate RevPAR growth," she added.

"Hotel stocks outperformed in October amid low investor expectations and rising interest rates," David Loeb, senior hotel research analyst and managing director at Baird, also told the industry publication.

"Third-quarter earnings reports were weaker than expected and showed sequential RevPAR growth deceleration, but investors remain more focused on rising interest rates and their impact on other real estate sectors' valuations rather than still-slowing hotel fundamentals," Loeb further noted

 

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