Time To Take Another Bite At Apple Hospitality
- I consider the limited service segment to be the best value at this time.
- APLE has outperformed CLDT and I thought it would be a good time to write an update.
- I believe APLE is well-positioned to benefit in the M&A world and CLDT seems to be a prime target.
The Lodging REIT sector has begun to heat back up and I have been especially pleased with a few picks such as Ryman Hospitality Properties (RHP), up 27% since I selected it in November 2017 and Hersha Hospitality (HT) up 25% since March. U.S. industry-wide RevPAR grew at a healthy 3.3% in first quarter 2018 and the luxury sector performed best (up 5.9%).
I recommend a selective strategy in lodging and in my recent newsletter, and I explained that “I consider the limited service segment to be the best value at this time”. A few weeks ago I wrote on Chatham Lodging (CLDT), a monthly-paying bell weather for many retail investors. On May 154h I wrote,
While Chatham has under-performed the peers year-to-date, I believe the company is well positioned to move the needle. Maintaining BUY on Chatham.”
As you can see, APLE has outperformed Chatham and I thought it would be a good time to write an update. I’m currently a shareholder, but given the bounce witnessed in the Lodging REIT sector it could be the time to take another bite at Apple!