Xenia Hotels & Resorts (XHR): Assessing Valuation After Recent 10% Share Price Decline

Xenia Hotels & Resorts (XHR) has seen its shares slip about 10% over the past month, catching some investors’ attention. With this downturn, it is natural to wonder how the company’s fundamentals stack up and what is driving recent moves.

See our latest analysis for Xenia Hotels & Resorts.

Over the past year, Xenia Hotels & Resorts has experienced notably choppy momentum, with the 1-year total shareholder return falling 9.2%, and more recent 1-month share price returns showing an even steeper 10% decline. The fading momentum hints that investors may be weighing increased risks. However, it is worth remembering the company’s 5-year total return still stands at an impressive 69%.

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With shares trading at a notable discount to analyst targets and recent performance lagging, investors may wonder if Xenia Hotels & Resorts is truly undervalued right now or if the market is already pricing in future growth prospects.

Most Popular Narrative: 14.6% Undervalued

At $12.81, Xenia Hotels & Resorts is trading below the fair value of $15 estimated by the most followed narrative, highlighting a gap between the company's present performance and its projected worth.

“The company’s exposure to high-growth urban and tech-centric markets such as Northern California is starting to pay off, with strong weekday corporate demand linked to the AI and tech sectors boosting occupancy and rates. As business travel continues its gradual rebound, this should drive sustained improvements in RevPAR and EBITDA in these strategically positioned assets.”

Read the complete narrative.

Curious what powers this target price? The secret isn’t just about location. There is a bold forecast riding on margin moves and a multiple that may surprise you. Find out how ambitious projections about profit and revenue could set the scene for Xenia's next potential rerating. Read the full story inside.

Result: Fair Value of $15 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, persistent weakness in leisure demand or ongoing labor cost pressures could quickly undercut margin recovery and challenge the optimistic outlook for Xenia Hotels & Resorts.

Find out about the key risks to this Xenia Hotels & Resorts narrative.

Another View: Are Multiples Sending a Different Signal?

While the current fair value estimate suggests Xenia Hotels & Resorts is undervalued, a look at its price-to-earnings ratio tells a different story. Xenia trades at 19.6x earnings, which is higher than the global industry’s 17.3x and above the fair ratio of 14.9x. This points to potential overvaluation if the market reverts to historical norms. Which signal should investors trust in this case?

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Xenia Hotels & Resorts Narrative

If you see the story differently or just want to test your own view, you can easily dive into the data and shape your own conclusions in just a few minutes with Do it your way.

A great starting point for your Xenia Hotels & Resorts research is our analysis highlighting 2 key rewards and 4 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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