Rising Labor Costs And Inflation Will Squeeze Hotel Margins

Service Properties Trust’s analyst price target has increased from $2.25 to $2.75, primarily due to improved liquidity and debt maturity management following a recent zero-coupon debt issuance, though upside remains constrained by net lease challenges and substantial longer-term debt maturities. Analyst Commentary Recent zero-coupon debt issuance has reduced near-term liquidity risk and should bring the company back into compliance with debt covenants.

Analysts have lowered their price target for Service Properties Trust to $2.25, citing muted hotel earnings growth, persistent net lease headwinds, and elevated refinancing risk from significant upcoming debt maturities, which collectively limit near-term upside. Analyst Commentary Bearish analysts cite slow and only moderate post-renovation earnings growth in the hotel segment.

Despite improved revenue growth forecasts, a notable decline in net profit margin has led to a reduced consensus analyst price target for Service Properties Trust, now set at $2.50. Valuation Changes Summary of Valuation Changes for Service Properties Trust The Consensus Analyst Price Target has fallen from $2.77 to $2.50.

AnalystConsensusTarget has decreased profit margin from 5.3% to 4.7% and increased future PE multiple from 8.7x to 9.8x.

AnalystConsensusTarget made no meaningful changes to valuation assumptions.

AnalystConsensusTarget has decreased future PE multiple from 11.3x to 9.6x.

AnalystConsensusTarget made no meaningful changes to valuation assumptions.

AnalystConsensusTarget made no meaningful changes to valuation assumptions.