doggydogworld

Inhospitable Value at Hospitality Properties Trust

No question HPT is overpaying the dividend. Barring a miracle they will cut it, but that's already priced in. A couple comments:

1. Hotel portion of HPT deserves higher multiple than your comps due to the nature of the leases and lower overall leverage. HPT sailed thru the post-9/11 downturn which crushed most hotel REITs.

2. Deferred rent, TA financial condition, etc. are all irrelevant. HPT owns whatever cash flow the trucks stops will produce. You have to value HPT's stake based on that cash flow. TA doesn't matter.

3. The recent drop in oil prices alleviates the inventory cash crunch at the truck stops. This doesn't change valuation but lessens the immediate cash pressures.

Disclosure, I am long HPT-C. Sold my HPT common years ago at 35 and felt stupid when it went to 50.