Temple Hotels (TPH.TO) Buy, Sell or Hold

Temple Hotels (TPH.TO)

2.10

-0.00 (0.00%)

as of Feb 21, 2020, 9:00:00 pm Market Open.

14 watching

RISKY

High risk/high reward. High dividend. Leveraged to Western Canada in Fort McMurry. Struggled in high cost debt, but have put much of that behind them. Recently started looking at it. A 1 trick pony so a bit more risk there.

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SELL

A lodging REIT with a huge concentration in Fort Mac. Doesn’t like this one. On a risk adjusted basis, it’s kind of like walking across a minefield. There are other larger caps with similar returns, but without the risk.

WEAK BUY

Has come back a lot. Did an issue in February. Business has picked up for them. They are pretty close to earning their payout ratio. High risk and fair amount of risk. Onee of the best performing so far this year. Have done a lot to clean themselves up.

DON'T BUY

Lots of debt. The only thing positive is that it is very heavy in the tar sands area where activity is picking up. Definitely Caveat Emptor.

WEAK BUY

They are in the hotel sector. Significant concentration in Fort McMurray and some other markets in Alberta. It is concentrated in an asset class as well as in a region. It is not a bad place to be in today.

DON'T BUY

High risk/high return REIT. Fort McMurray. He doesn’t have a lot of hotel investments because guests are normally there for one night. If you think Fort McMurray is going to do well, then you will do very well. Management likes a lot of debt and investors have to be comfortable with that approach.

HOLD

Recently sold one of their better assets to help their financial situation. 15% yield but about 144% payout ratio, which is very hard to sustain. Tar sands are picking up so chances of improving are there.

DON'T BUY

15% yield. Pretty sure they are overpaying on distributions but expect they will try to keep it up as long as they can. Activity in the tar sands is improving.

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COMMENT

Had a heavy weighting to Fort McMurray so it suffered but is on the rebound now. If you feel strongly that that region should continue to do well, there could be some upside. 15.6% yield that would indicate some caution is needed. (Owns some of the debt.)

COMMENT

Limited service hotels with a big exposure to Fort McMurray and tied to oil sands activity. As oil prices go, so will occupancy in their hotels. Not a fan of lodging REITs, as he prefers longer-term cash flows that are more stable. 17% yield. If you are comfortable betting on the oil sands, you're probably okay.

DON'T BUY

Right in the tar sands. Significant pick up in the tar sands. It looked like it would be a survivor. The environment should be improving. Buyer beware because they have tones of debt.

DON'T BUY

Numbers are down a great deal such as $7 million in income to about $900 thousand. Quarter over quarter figures were very bad. Very little coverage. Will probably survive. 14.7% distribution.

DON'T BUY

Has never been a big fan of lodge/inn REITs because the duration of the cash flow is very short. Leverage is about 74% but should be 40% maximum. Recently cut distributions so they're probably sustainable now.

COMMENT

They were very heavily into the tar sands. That whole sector has started to improve. (See Northern Properties (NPR.UN-T) in top picks.)

DON'T BUY

Sinking into the oil sands. Too much debt.

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Temple Hotels (TPH.TO)