Service Properties Trust (NASDAQ:SVC) Sees Significant Increase in Short Interest

Key Points

• Short interest surged: short interest rose 38.7% to 9,365,511 shares as of March 31, equal to about 5.7% of the stock and a days-to-cover ratio of 3.6.
• Insider buying: CEO Christopher Bilotto and Director Donna Fraiche recently bought 100,000 and 83,333 shares respectively at $1.20 per share, part of sizeable insider purchases disclosed in the last 90 days.
• Analyst and financial backdrop: the stock carries an average "Hold" rating with a $2.00 target, trades around $1.40, and shows high leverage (debt/equity ~5.0) with negative profitability, while paying a $0.01 quarterly dividend (≈2.9% yield).

Service Properties Trust (NASDAQ:SVC - Get Free Report) saw a large growth in short interest during the month of March. As of March 31st, there was short interest totaling 9,365,511 shares, a growth of 38.7% from the March 15th total of 6,752,266 shares. Based on an average daily volume of 2,632,360 shares, the days-to-cover ratio is currently 3.6 days. Approximately 5.7% of the company's stock are short sold.

Analyst Upgrades and Downgrades

A number of analysts have recently issued reports on SVC shares. Wells Fargo & Company dropped their price target on shares of Service Properties Trust from $2.50 to $2.00 and set an "equal weight" rating on the stock in a report on Thursday, January 22nd. Wall Street Zen raised shares of Service Properties Trust from a "sell" rating to a "hold" rating in a report on Saturday, March 28th. B. Riley Financial raised shares of Service Properties Trust from a "neutral" rating to a "buy" rating and set a $2.00 price target on the stock in a report on Thursday, April 2nd. Zacks Research downgraded shares of Service Properties Trust from a "strong-buy" rating to a "hold" rating in a report on Friday, January 30th. Finally, Weiss Ratings reiterated a "sell (d-)" rating on shares of Service Properties Trust in a research report on Thursday, January 22nd. One analyst has rated the stock with a Buy rating, two have given a Hold rating and one has issued a Sell rating to the company's stock. According to MarketBeat, the company currently has an average rating of "Hold" and an average target price of $2.00.

Insider Activity at Service Properties Trust

In other news, Director Donna D. Fraiche acquired 83,333 shares of the business's stock in a transaction that occurred on Thursday, April 2nd. The shares were bought at an average cost of $1.20 per share, with a total value of $99,999.60. Following the transaction, the director owned 182,013 shares of the company's stock, valued at $218,415.60. This trade represents a 84.45% increase in their position. The purchase was disclosed in a legal filing with the SEC, which can be accessed through this link. Also, CEO Christopher J. Bilotto purchased 100,000 shares of the company's stock in a transaction dated Thursday, April 2nd. The shares were bought at an average cost of $1.20 per share, for a total transaction of $120,000.00. The SEC filing for this purchase provides additional information. Insiders bought a total of 41,914,999 shares of company stock worth $50,297,999 in the last ninety days. 1.57% of the stock is currently owned by company insiders.

Hedge Funds Weigh In On Service Properties Trust

Institutional investors and hedge funds have recently made changes to their positions in the business. Caxton Associates LLP purchased a new position in shares of Service Properties Trust in the third quarter worth approximately $33,000. Savant Capital LLC purchased a new position in shares of Service Properties Trust in the third quarter worth approximately $37,000. BNP Paribas Financial Markets boosted its holdings in shares of Service Properties Trust by 54.4% in the second quarter. BNP Paribas Financial Markets now owns 14,470 shares of the real estate investment trust's stock worth $35,000 after buying an additional 5,099 shares during the last quarter. HighRoad Wealth Advisors LLC bought a new stake in Service Properties Trust during the 4th quarter worth approximately $29,000. Finally, CIBC Bancorp USA Inc. bought a new stake in Service Properties Trust during the 3rd quarter worth approximately $45,000. Hedge funds and other institutional investors own 77.62% of the company's stock.

Service Properties Trust Stock Performance

Shares of SVC traded up $0.07 on Wednesday, reaching $1.40. The company's stock had a trading volume of 7,629,954 shares, compared to its average volume of 5,913,551. The company has a debt-to-equity ratio of 5.00, a current ratio of 0.14 and a quick ratio of 0.14. The stock has a market capitalization of $234.43 million, a P/E ratio of -1.15 and a beta of 1.60. The stock's 50 day simple moving average is $1.93 and its two-hundred day simple moving average is $2.00. Service Properties Trust has a 12-month low of $1.13 and a 12-month high of $3.08.

Service Properties Trust (NASDAQ:SVC - Get Free Report) last posted its quarterly earnings data on Wednesday, February 25th. The real estate investment trust reported $0.17 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $0.01 by $0.16. The company had revenue of $397.45 million for the quarter, compared to the consensus estimate of $394.32 million. Service Properties Trust had a negative net margin of 11.15% and a negative return on equity of 29.70%. Service Properties Trust has set its FY 2026 guidance at 0.650-0.770 EPS.

Service Properties Trust Dividend Announcement

The firm also recently disclosed a quarterly dividend, which will be paid on Thursday, May 14th. Investors of record on Tuesday, April 21st will be issued a $0.01 dividend. The ex-dividend date of this dividend is Tuesday, April 21st. This represents a $0.04 dividend on an annualized basis and a dividend yield of 2.9%. Service Properties Trust's dividend payout ratio (DPR) is presently -3.31%.

About Service Properties Trust

Service Properties Trust NASDAQ: SVC is a real estate investment trust (REIT) specializing in the acquisition, ownership and leasing of service-oriented properties, with a primary focus on the lodging sector. The company structures long-term, triple-net leases with established hotel operators under franchise agreements with leading global brands. By partnering with recognized hotel companies, Service Properties Trust seeks to generate a stable income stream through rent payments, while offering operators the capital and balance-sheet flexibility to grow their portfolios.

Since its formation in 2010, Service Properties Trust has grown its portfolio through strategic sale-leaseback transactions, targeted property acquisitions and selective dispositions.

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