Summit Hotel (INN) Earnings Call Transcript

The Motley Fool

by newsfeedback@fool.com (Motley Fool Transcribing)

February 26, 2026

AI-Generated Deep Dive Summary

Summit Hotel Properties (INN) reported strong financial results in its Q4 earnings call, driven by improvements in key operating metrics and strategic moves to enhance profitability. Despite a 1.6% decline in same-store RevPAR due to challenges from government shutdowns and lower demand, the company saw significant gains in core markets like San Francisco and Orlando. These areas experienced growth fueled by citywide conventions, leisure demand, and the opening of Universal’s Epic Universe theme park. Additionally, Summit generated $51.3 million from selling three underperforming hotels, improving its portfolio’s overall performance and freeing up capital for future investments. The company’s financial health was bolstered by a 9% year-over-year increase in non-rooms revenue, driven by higher food, beverage, and amenity fees. Adjusted EBITDA reached $39.7 million for the quarter and $174.8 million for the full year, reflecting benefits from lower interest expenses and reduced share count. Summit also demonstrated strong expense management, with contract labor costs down nearly 9% and turnover rates falling 24% compared to the prior year. Looking ahead, Summit provided guidance for 2026, forecasting RevPAR growth of 0-3%, primarily due to average daily rate increases. Adjusted EBITDA is expected to range between $167 million and $181 million, with adjusted FFO per share projected at $0.73 to $0.85. The company’s dividend remains attractive, offering a 7.7% yield, while capital expenditures are expected to normalize at $55-65 million in 2026 after significant investments in 2025. Summit’s ability to strategically recycle capital through asset sales and manage costs effectively positions it for sustained growth. The company also highlighted tailwinds in key markets such as Fort Lauderdale, Asheville, and South Florida, where RevPAR gains were particularly strong. These factors, combined with a robust balance sheet and extended debt maturity, underscore Summit’s financial stability and resilience in the competitive hotel industry. For investors, Summit’s performance highlights its ability to navigate market challenges while delivering returns through strategic asset management and operational efficiency. The company’s focus on high-performing markets and disciplined cost controls aligns with broader trends in the hospitality sector, making it a compelling investment opportunity for those seeking stable yields and growth potential.

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Originally published on The Motley Fool on 2/26/2026