HENDERSONVILLE, Tennessee, and MILWAUKEE—The Baird/STR Hotel Stock Index jumped 19 percent in August 2020 to a level of 3,582. Year to date through the first eight months of 2020, the stock index was down 32 percent.
“Hotel stocks significantly outperformed in August along with other travel-related stocks as investors cheered continued progress on the medical front and accommodative interest rate policies that are expected to be in place for the foreseeable future,” said Michael Bellisario, senior hotel research analyst and director at Baird. “Both the hotel brands and the hotel REITs outperformed their respective benchmarks by more than 10 percentage points during the month even as the broader stock market’s momentum remained positive.”
“As summer vacation season officially comes to a close, hoteliers are bracing for a post-Labor Day lull as corporate travel remains muted and group business is almost non-existent,” said Amanda Hite, STR’s president. “Leisure travelers have lifted U.S. performance metrics in recent months, with occupancy even topping 50 percent in mid-August, but demand has since retracted. We revised our latest RevPAR forecast slightly downward to -52 percent for this year, and we do not foresee any catalyst to materially change this outlook for the better.”
The August 2020 performance of the Baird/STR Hotel Stock Index surpassed both the S&P 500 (up 7.0 percent) and the MSCI US REIT Index (up 0.7 percent).
The hotel brand sub-index increased 21 percent from July to 6,495, while the Hotel REIT sub-index grew 12.3 percent to 764.