The Baird/STR Hotel Stock Index increased 11.8% in November to close the month at 3,474. Year to date, the index has grown 12.3%.
“Investor sentiment shifted after the election, and stock gains accelerated much like weekly RevPAR (revenue per available room) growth,” said Amanda Hite, STR’s president and CEO. “RevPAR figures were much stronger than expected, and we think November will go in the books as an outlier. We do not expect the election result to serve as a demand catalyst beyond forecasted levels, but perhaps the overall growth slowdown the industry is facing will ease a bit in 2017.”
“Hotel stocks experienced huge gains in November, especially after the election, as investors embraced the prospects for stronger economic growth,” said David Loeb, senior hotel research analyst and managing director at Baird. “November RevPAR growth trends were solid, potentially due to the realization of pent-up pre-election demand, and hotel stock valuations today are pricing in a much lower probability of slower or slowing RevPAR growth in 2017.”
The Baird/STR Hotel Stock Index for November outperformed both the S&P 500 (+3.4%) and the MSCI REIT (RMZ) (-2.0%).
The Hotel Brand sub-index increased 10.5% in November to 4,598. The Hotel REIT sub-index jumped 14.3% to 1,545 during the month.
The Baird/STR Hotel Stock Index was set to equal 1,000 on 1 January 2000. Last cycle, the Index peaked at 3,178 on 5 July 2007. The Index’s low point occurred on 6 March 2009 when it dropped to 573.
The Hotel Brand sub-index was set to equal 1,000 on 1 January 2000. Last cycle, the sub-index peaked at 3,407 on 5 July 2007. The sub-index’s low point occurred on 6 March 2009 when it dropped to 722.
The Hotel REIT sub-index was set to equal 1,000 on 1 January 2000. Last cycle, the sub-index peaked at 2,555 on 2 February 2007. The sub-index’s low point occurred on 5 March 2009 when it dropped to 298.
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