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1. Company Snapshot

1.a. Company Description

Pebblebrook Hotel Trust (NYSE: PEB) is a publicly traded real estate investment trust ("REIT") and the largest owner of urban and resort lifestyle hotels in the United States.The Company owns 53 hotels, totaling approximately 13,200 guestrooms across 14 urban and resort markets, with a focus on the west coast gateway cities.

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1.b. Last Insights on PEB

Pebblebrook Hotel Trust's recent performance was negatively impacted by a Moody's credit rating downgrade to Ba3, indicating higher risk compared to peers. The company's liquidity profile improved due to a lower capital investment outlook for 2025 and 2026, but this was not enough to offset the negative sentiment surrounding its credit rating. Additionally, the Series H preferreds are trading at a discount, with a yield of 8.5%, but this may not be enough to compensate for the increased risk.

1.c. Company Highlights

2. Pebblebrook Hotel Trust's Q4 2025 Earnings: A Strong Finish to a Challenging Year

Pebblebrook Hotel Trust reported a stronger-than-expected fourth quarter 2025 performance, with same-property total RevPAR increasing 2.9% and same-property hotel EBITDA growing 3.9% to $64.6 million, $2.2 million above the midpoint of their outlook. Adjusted EBITDA climbed 11.1% to $69.7 million, driven by strong hotel results, lower corporate G&A, and slightly higher-than-expected business interruption income. Earnings per share (EPS) came in at $0.27, beating analyst estimates of $0.23.

Publication Date: Mar -05

📋 Highlights
  • Q4 2025 RevPAR Growth:: Same-property total RevPAR rose 2.9%, driven by 190-basis-point occupancy gain and 5.5% non-room RevPAR increase.
  • EBITDA Outperformance:: Same-property hotel EBITDA hit $64.6M, exceeding the midpoint of guidance by $2.2M, with annual adjusted EBITDA rising 11.1% to $69.7M.
  • San Francisco Surge:: RevPAR surged 37.9% YoY, outperforming expectations, while Los Angeles and D.C. lagged due to disruptions.
  • 2026 Outlook Cautious but Positive:: Full-year RevPAR growth projected at 2–4%, with Q1 RevPAR expected to rise 7.5–9% amid strong event-driven demand (e.g., Super Bowl).
  • Boston Market Recovery:: Expected to rank third in EBITDA recovery in 2026, with 80% occupancy forecast and growth potential from meetings/event space revenue.

Operational Highlights

The company's redeveloped resorts and urban recovery markets, particularly in San Francisco, drove strong growth, while markets like Los Angeles and Washington, D.C. were impacted by unexpected events. Same-property occupancy increased 190 basis points, while ADR declined 1.6%, resulting in a 1.2% RevPAR increase. Out-of-room performance continued to drive growth, with non-room RevPAR climbing 5.5%. As Jon Bortz noted, "Our operating performance turned out better than expected despite the government shutdown and the resulting travel disruptions."

Outlook and Guidance

Looking ahead to 2026, Pebblebrook expects both the industry and their portfolio to perform well, with a cautious outlook due to policy and geopolitical risks. The company forecasts RevPAR growth of 2% to 4% and total RevPAR growth of 2.25% to 4.25%. Same-property EBITDA is expected to increase by 2.1% to 6%. The company's first quarter performance is strong, with January RevPAR growing 4.6% and February on pace to achieve RevPAR growth of 15% or more.

Valuation and Metrics

With a P/E Ratio of -23.08 and an EV/EBITDA of 14.12, the market appears to be pricing in some level of risk. The company's Net Debt / EBITDA ratio stands at 8.49, indicating a relatively high level of leverage. However, with a ROIC of 0.71% and an ROE of -2.57%, the company's returns are still negative. Analysts estimate next year's revenue growth at 2.3%, which is in line with the company's guidance.

Transaction Market and Capital Allocation

Pebblebrook expects the transaction market to continue to improve, with a focus on luxury assets and larger transactions. The company plans to continue selling assets, paying down debt, and using capital to buy back stock and reduce leverage. With 77% of their portfolio unencumbered by brand and operator, the company is well-positioned to take advantage of potential opportunities.

3. NewsRoom

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Pebblebrook Hotel Trust Schedules First Quarter 2026 Earnings Release and Conference Call

Mar -10

Source: businesswire.com

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APG Asset Management US Inc. Buys New Holdings in Pebblebrook Hotel Trust $PEB

Mar -01

Source: defenseworld.net

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Pebblebrook Hotel Trust (PEB) Q4 2025 Earnings Call Transcript

Feb -27

Source: seekingalpha.com

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Pebblebrook Hotel (PEB) Reports Q4 Earnings: What Key Metrics Have to Say

Feb -26

Source: zacks.com

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Pebblebrook Hotel Trust Reports 2025 Results and Provides 2026 Outlook

Feb -25

Source: businesswire.com

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Palogic Value Fund Withdraws Nominees and Shareholder Proposal at Pebblebrook Hotel Trust

Feb -18

Source: businesswire.com

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Pebblebrook Hotel Trust Closes New $450 Million Unsecured Term Loan and Completes Extension of $650 Million Unsecured Revolving Credit Facility

Feb -12

Source: businesswire.com

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Pebblebrook Hotel Trust Elects Nina P. Jones and Bill Bayless to Board of Trustees

Feb -09

Source: businesswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.69%)

6. Segments

Room

Expected Growth: 2.5%

Pebblebrook Hotel Trust's 2.5% room growth is driven by increasing demand from business and leisure travelers, particularly in urban markets. RevPAR (Revenue per Available Room) growth is fueled by a strong economy, low supply growth, and effective revenue management strategies. Additionally, the company's focus on repositioning and renovating its portfolio, as well as its strategic acquisitions, contribute to the growth.

Food and Beverage

Expected Growth: 3.5%

Pebblebrook Hotel Trust's Food and Beverage segment growth of 3.5% is driven by increasing demand for experiential travel, rising average daily rates, and strategic investments in restaurant and bar renovations. Additionally, the company's focus on local and seasonal menu offerings, as well as partnerships with popular food and beverage brands, contribute to the segment's growth.

Other

Expected Growth: 2.0%

Pebblebrook Hotel Trust's 2.0% growth is driven by increasing RevPAR (Revenue per Available Room) due to strong demand, effective pricing strategies, and a favorable mix of business and leisure travelers. Additionally, the company's strategic asset management initiatives, cost savings, and accretive capital investments contribute to its growth momentum.

7. Detailed Products

Luxury Hotels

Pebblebrook Hotel Trust owns and operates luxury hotels and resorts, offering high-end accommodations and amenities to guests.

Upscale Hotels

The company's upscale hotels offer stylish rooms, modern amenities, and exceptional service, catering to discerning travelers.

Lifestyle Hotels

Pebblebrook's lifestyle hotels blend stylish design, vibrant atmosphere, and modern amenities, appealing to travelers seeking unique experiences.

Food and Beverage

The company's hotels offer a range of dining options, from fine dining to casual eateries, providing guests with diverse culinary experiences.

Meeting and Event Spaces

Pebblebrook's hotels feature modern meeting and event spaces, ideal for corporate events, weddings, and social gatherings.

Wellness and Recreation

The company's hotels offer fitness centers, spas, and recreational activities, promoting relaxation and well-being.

8. Pebblebrook Hotel Trust's Porter Forces

Forces Ranking

Threat Of Substitutes

Pebblebrook Hotel Trust operates in the hospitality industry, which is characterized by a moderate level of substitutes. While there are alternative accommodations available, such as Airbnb and vacation rentals, hotels remain a popular choice for travelers. The company's focus on luxury and upscale hotels helps to differentiate it from substitutes.

Bargaining Power Of Customers

Pebblebrook Hotel Trust's customers have limited bargaining power due to the fragmented nature of the hospitality industry. Individual customers have little influence over the company's pricing and services. However, the rise of online travel agencies and review platforms has increased customers' ability to compare prices and services, which could potentially impact the company's pricing power.

Bargaining Power Of Suppliers

Pebblebrook Hotel Trust's suppliers, including food and beverage providers, linen suppliers, and maintenance contractors, have a moderate level of bargaining power. While the company has some flexibility in choosing suppliers, it is still dependent on these vendors to operate its hotels efficiently. The company's scale and reputation help to mitigate supplier power, but it is still subject to market fluctuations and supplier negotiations.

Threat Of New Entrants

The threat of new entrants in the hospitality industry is relatively low due to the high barriers to entry, including significant capital requirements, regulatory hurdles, and the need for established relationships with travel agencies and online booking platforms. While new hotels and chains may enter the market, Pebblebrook Hotel Trust's established brand and scale provide a competitive advantage.

Intensity Of Rivalry

The hospitality industry is highly competitive, with many established players and a constant influx of new entrants. Pebblebrook Hotel Trust operates in a crowded market, with numerous luxury and upscale hotels competing for customers. The company's focus on unique amenities and services helps to differentiate it from competitors, but the industry's high level of rivalry puts pressure on pricing, occupancy rates, and customer loyalty.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 48.86%
Debt Cost 4.04%
Equity Weight 51.14%
Equity Cost 13.10%
WACC 8.67%
Leverage 95.55%

11. Quality Control: Pebblebrook Hotel Trust passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Chatham Lodging

A-Score: 5.6/10

Value: 6.7

Growth: 5.3

Quality: 4.9

Yield: 6.0

Momentum: 2.5

Volatility: 8.0

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Braemar Hotels & Resorts

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Quality: 4.9

Yield: 9.0

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Volatility: 3.3

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RLJ Lodging

A-Score: 5.4/10

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Growth: 4.9

Quality: 4.2

Yield: 8.0

Momentum: 1.0

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SVC

A-Score: 4.8/10

Value: 10.0

Growth: 3.1

Quality: 4.9

Yield: 6.0

Momentum: 2.0

Volatility: 3.0

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A-Score: 4.7/10

Value: 9.3

Growth: 4.0

Quality: 4.2

Yield: 0.0

Momentum: 10.0

Volatility: 0.3

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Pebblebrook Hotel

A-Score: 4.2/10

Value: 8.2

Growth: 4.3

Quality: 3.6

Yield: 0.0

Momentum: 3.5

Volatility: 5.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

12.74$

Current Price

12.74$

Potential

-0.00%

Expected Cash-Flows