We think it’s a good time to analyze Braemar Hotels & Resorts Inc. (NYSE: BHR) As it seems, the company may be on the verge of a huge achievement. Braemar Hotels & Resorts is a Real Estate Investment Trust (REIT) focused on investing in luxury hotels and resorts. The market-cap company’s loss of $333 million has narrowed since it announced a loss of $40 million for the full year, compared to the last loss of $18 million on the last twelve months, as it approaches equilibrium. The most pressing concern for investors is Braemar Hotels & Resorts’ path to profitability – when will it break even? We’ve put together a brief overview of industry analysts’ expectations for the company, its year of profitability and its implied growth rate.
Check out our latest analysis for Braemar Hotels & Resorts
The consensus of 4 US REIT analysts is that Braemar Hotels & Resorts is close to breaking even. They expect the business to make a terminal loss in 2021, before making a profit of US$584,000 in 2022. Therefore, the business should break even in about a year or less! We calculated the rate at which the business must grow to reach the consensus forecast predicting breakeven within 12 months. It turns out that an average annual growth rate of 69% is expected, which signals a lot of confidence from analysts. If the business grows at a slower pace, it will become profitable later than expected.
The developments underlying the growth of Braemar Hotels & Resorts are not the focus of this general overview, however, consider that overall a high rate of growth is not unusual, particularly when a company is in a period of investment.
One thing we would like to highlight with Braemar Hotels & Resorts is its debt-to-equity ratio of over 2x. As a general rule, debt should not exceed 40% of your equity, and the company has significantly exceeded this figure. A higher level of debt requires stricter capital management, which increases the risk associated with investing in the loss-making company.
There are fundamentals of Braemar Hotels & Resorts that are not covered in this article, but we must re-emphasize that this is only a basic overview. For a more complete overview of Braemar Hotels & Resorts, check out the Braemar Hotels & Resorts corporate page on Simply Wall St. We’ve also compiled a list of key factors you should consider:
Evaluation: What is Braemar Hotels & Resorts worth today? Has future growth potential already been factored into the price? The intrinsic value infographic in our free research report visualizes whether Braemar Hotels & Resorts is currently being mispriced by the market.
Management team: An experienced management team at the helm boosts our confidence in the business – take a look at who sits on the Braemar Hotels & Resorts board and the CEO’s background.
Other High Performing Stocks: Are there other stocks that offer better prospects with a proven track record? Explore our free list of these great stocks here.
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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.