RLJ - Beneficiary of summer events/macro improvement though at present we lean to higher ADR portfolios

研报英文原文证据摘录

RLJ - Beneficiary of summer events/macro improvement though at present we lean to higher ADR portfolios

Truist Securities

Importantly and underdiscussed by investors is that RLJ's market exposure for World Cup is spread geographically in some

cases -- resulting in uneven benefits. Our general take is that in-demand urban areas and locations closer to World Cup stadiums are

more likely to have both higher occupancy and the ability to push ADR relative to more distant locations. As an example, we compare

two of RLJ's Embassy Suites in greater L.A. in terms of their current lowest-available room rates for a one-night stay that we researched

online. At the LAX Airport South location which is closer to the local stadium, room rates for the rest of June are spread from $211/night

to $437/night with room rates north of $300 around a number of group stage World Cup matches. Comparatively, the Downey location

in southeast L.A. has limited price variance in later June ($167-$248). Another example is in greater San Francisco where one of RLJ's

Embassy Suites near San Francisco Airport has clear spikes in room rates around arguably bigger World Cup matches (rates for the rest

of June ranging from $156 to $411); comparatively the more distant-to-stadium Hilton Garden Inn in Emeryville (East Bay) has relatively

limited room rate spread especially in later June (room rates starting on June 19th range from $141-$190).

Modeling matters

Our base case assumption is of a continued beat-and-raise earnings setup based on the present macro. While we model at/above

the high-end of 2026 guidance, we could make a reasonable case that we are still quite light on our estimates from RevPAR down to

operating margins.