RLJ Lodging Trust: Extreme Pessimism Reflected In The Share Price (Rating Upgrade)

Ivo Kolchev
1.16K Followers

Summary

  • RLJ Lodging Trust is a hotel REIT focused on urban hotels in the Sunbelt region.
  • Q4 2024 and early 2025 operating performance has been solid. Investors, however, are worried about the future, with recent warnings signs increasing the odds that RLJ cuts its 2025 outlook.
  • This is more than reflected in the company's valuation and share price, which is trading at levels last seen during the COVID-19 pandemic.
  • The REIT's preferred shares offer high current income with a substantial safety cushion for risk-averse investors.
  • Key risks to consider include a potential U.S. recession and a high proportion of debt in the capital structure.
Hotel sign

mbbirdy/E+ via Getty Images

Introduction

RLJ Lodging Trust (NYSE:RLJ) has underperformed the Vanguard Real Estate Index Fund ETF (VNQ) by ~20% so far in 2025:

I previously covered RLJ back in December 2024 with a Buy rating in a comparison article with Chatham Lodging

This article was written by

Ivo Kolchev
1.16K Followers
I ventured into investing in high school in 2011, mainly in REITs, preferred stocks, and high-yield bonds, starting a fascination with markets and the economy that has not faded despite the years. More recently I have been combining long stock positions with covered calls and cash secured puts. I approach investing purely from a fundamental long-term point of view. On Seeking Alpha I mostly cover REITs and financials, with occasional articles on ETFs and other stocks driven by a macro trade idea.

Analyst’s Disclosure:I/we have a beneficial long position in the shares of RLJ either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

About RLJ Stock

SymbolLast Price% Chg
EPS
PE
Div Rate
Yield
Short Interest
Market Cap
Volume
Compare to Peers

More on RLJ

Related Stocks

SymbolLast Price% Chg
RLJ
--
RLJ.PR.A
--
Compare

Trending Analysis

Trending News