Board Member Of Chatham Lodging Makes $69K Buy

Disclosed in the latest SEC filing, a significant insider purchase on January 16, involves Elizabeth Mary Higgins, Board Member at Chatham Lodging CLDT.

What Happened: In a significant move reported in a Form 4 filing with the U.S. Securities and Exchange Commission on Tuesday, Higgins purchased 6,504 shares of Chatham Lodging, demonstrating confidence in the company's growth potential. The total value of the transaction stands at $69,983.

Tracking the Wednesday's morning session, Chatham Lodging shares are trading at $10.49, showing a down of 0.0%.

All You Need to Know About Chatham Lodging

Chatham Lodging Trust is a U.S.-based real estate investment trust that invests in upscale extended-stay hotels. The firm operates across various states in the U.S., including California, New York, Texas, Florida, Minnesota, Massachusetts, and Pennsylvania among others. Substantially all of the company's assets are held and operated by its Operating Partnership, Chatham Lodging, LP. Chatham Lodging LP and its subsidiaries lease the overall company's hotels. The firm operates through a single segment because of the similar economic characteristics of its hotels. Chatham's revenue streams include Room, Food and beverage, and Other. Room comprises the majority of total revenue. Chatham's hotels operate under major brands, including Hilton, Marriott, and Hyatt.

Chatham Lodging: A Financial Overview

Revenue Growth: Chatham Lodging's revenue growth over a period of 3 months has faced challenges. As of 30 September, 2023, the company experienced a revenue decline of approximately -1.3%. This indicates a decrease in the company's top-line earnings. In comparison to its industry peers, the company trails behind with a growth rate lower than the average among peers in the Real Estate sector.

Interpreting Earnings Metrics:

• Gross Margin: The company shows a low gross margin of 37.8%, indicating concerns regarding cost management and overall profitability relative to its industry counterparts.

• Earnings per Share (EPS): Chatham Lodging's EPS lags behind the industry average, indicating concerns and potential challenges with a current EPS of 0.11.

Debt Management: With a below-average debt-to-equity ratio of 0.64, Chatham Lodging adopts a prudent financial strategy, indicating a balanced approach to debt management.

Valuation Overview:

• Price to Earnings (P/E) Ratio: Chatham Lodging's current Price to Earnings (P/E) ratio of 349.67 is higher than the industry average, indicating that the stock may be overvalued according to market sentiment.

• Price to Sales (P/S) Ratio: The P/S ratio of 1.66 is lower than the industry average, implying a discounted valuation for Chatham Lodging's stock in relation to sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): Chatham Lodging's EV/EBITDA ratio, lower than industry averages at 10.19, indicates attractively priced shares.

Market Capitalization Analysis: The company exhibits a lower market capitalization profile, positioning itself below industry averages. This suggests a smaller scale relative to peers.

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Why Insider Transactions Are Key in Investment Decisions

Insightful as they may be, insider transactions should be considered alongside a thorough examination of other investment criteria.

In the context of legal matters, the term "insider" refers to any officer, director, or beneficial owner holding more than ten percent of a company's equity securities, as outlined by Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and significant hedge funds. Such insiders are obligated to report their transactions through a Form 4 filing, which must be completed within two business days of the transaction.

Pointing towards optimism, a company insider's new purchase signals their positive anticipation for the stock to rise.

Despite insider sells not always signaling a bearish sentiment, they can be driven by various factors.

Exploring Key Transaction Codes

Surveying the realm of stock transactions, investors often give prominence to those unfolding in the open market, systematically detailed in Table I of the Form 4 filing. A P in Box 3 indicates a purchase, while S signifies a sale. Transaction code C denotes the conversion of an option, and transaction code A denotes a grant, award, or other acquisition of securities from the company.

Check Out The Full List Of Chatham Lodging's Insider Trades.

This article was generated by Benzinga's automated content engine and reviewed by an editor.