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Investing.com - Cantor Fitzgerald initiated coverage of PebbleBrook Hotel Trust (NYSE:PEB) with a Neutral rating and a $12.00 price target, representing approximately 4.6% upside from current levels. According to InvestingPro data, the stock currently trades at a price-to-book ratio of 0.5x, suggesting potential undervaluation despite its volatile price movements.
The investment firm’s analysis is based on a 2026 estimated EV/EBITDA multiple of 12.5x, which stands above the 10.5x average for the broader hotel sector.
PebbleBrook’s portfolio, which derives 45% of its demand from leisure customers, has experienced average daily rate (ADR) pressure throughout the year, according to Cantor Fitzgerald.
While urban market segments including San Francisco have shown recovery signs, the company faced headwinds in the first half of 2025 due to fires in Los Angeles.
In mid-September, PebbleBrook addressed an upcoming balance sheet obligation by issuing a new convertible senior note due in 2030 to replace an outstanding $400 million convertible note that was set to mature in 2026.
In other recent news, Pebblebrook Hotel Trust has successfully completed a $400 million convertible senior notes offering, maturing in 2030, with an interest rate of 1.625% payable semiannually. The offering included $50 million in notes sold through the full exercise of the initial purchasers’ over-allotment option. The company plans to use the proceeds to partially retire its existing $750 million convertible notes due in 2026. Stifel has raised its price target for Pebblebrook Hotel Trust to $14.00 from $13.00, maintaining a Buy rating on the company. Meanwhile, Truist Securities reiterated its Hold rating with a price target of $11.00. The net proceeds from the offering are estimated to be approximately $389.7 million after deducting expenses. Pebblebrook also announced plans to repurchase $50 million of its common shares using cash on hand. These developments reflect the company’s strategic financial maneuvers to optimize its debt structure.
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