Manish Modi's questions to Chatham Lodging Trust (CLDT) leadership • Q4 2024
Question
Manish Modi asked about any operational impact from the recent wildfires in the Los Angeles area. He also questioned the company's stock valuation, noting its flat performance over the last 12-18 months despite significant balance sheet deleveraging and strong performance in markets like Silicon Valley.
Answer
Executive Dennis Craven reported no physical damage from the LA wildfires, noting one of the three area hotels benefited from displaced residents and insurance-related business. Regarding the stock's valuation, Executive Jeremy Wegner explained that while the price-to-FFO multiple is in line with peers, the EV-to-EBITDA multiple is at a discount due to higher, market-rate interest costs on its refinanced debt. Executive Jeffrey Fisher added that investor uncertainty about the pace of the Silicon Valley recovery, which is still well below 2019 levels, likely puts a 'lid on our share price' until growth becomes more consistent.