“With the rollout of Covid-19 vaccines in the US, we believe that the worst for the Trust is over but investors are not pricing in its ability to double its earnings over the next two years. We project a multi-year revenue per available room (RevPAR) growth trend and 4-year normalisation period, delivering FY2021F and FY2022F yields of 5.9% and 12.8% respectively,” note the analysts.
ARA US Hospitality Trust is a “buy” as recovery is within reach, with the potential to double its earnings over the next two years, says DBS Group Research analysts Geraldine Wong and Derek Tan.
The analysts are maintaining their recommendation with a target price of 69 US cents, which represents a 28% upside.
