Ashford Hospitality Trust (NYSE: AHT) stock reached its highest point since the year last month, and then, it had a sharp drop. On July 2, the company announced that a reverse split of its common stock at a ratio of 1-for-10, so, is the stock worth buying now?
A reverse stock split does not change the value of the company, but the company believes that it will optimize its position, and will benefit its all shareholders.
However, investors are considering another thing about the company. On July 6, Ashford reported preliminary Q2 revenue per available room (RevPAR) which more than tripled from the same quarter a year prior, but its RevPAR actually dropped 37% compared to Q2 2019.
It seems that the investors were expecting better numbers, because the company has significant debt maturities in the future, which will continue to affect its stock price. Therefore, the stock does not look very attractive now.
Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.