Value
4.5/10data confidence 67%| Component | Sub-score |
|---|---|
| P/S | 8.2 |
| EV/EBITDA | 4.0 |
| p ocf | 8.0 |
| Analyst target | 3.0 |
- ▸P/OCF: 11.4x (FFO proxy — REITs gated off P/E)
APLE · Why this verdict
Why Apple Hospitality REIT (APLE) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictSELL
Overall score5.0/10
ConfidenceHIGH
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
Apple Hospitality REIT generates strong cash (206% FCF to net income) with a 5.2% dividend and conservative debt, but the price of $18.52 is above the $15.47 analyst target, growth is slow and the stock is overbought near its 52-week high.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Apple Hospitality converts 206% of net income into free cash flow and has an 8/9 Piotroski F-Score, supporting its dividend. Quality breakdown | Free cash flow to net income stays above 150% over the next 12 months. | →Stable |
| CounterDepreciation-heavy REIT earnings make FCF/NI look high, and no competitive moat leaves hotel demand and pricing exposed. | ||
The price of $18.52 is 16.5% above the $15.47 analyst target, leaving negative upside against 14.3% downside. Targets | Analysts raise targets above $18 or the price pulls back toward the target. | →Stable |
| CounterA reward-to-risk of -1.16 leaves no cushion if lodging demand softens, though analyst coverage is light. | ||
Growth scores only 3.3/10 and the last 4 quarters showed 1 beat, 2 in-line results and 1 miss, with an average surprise of 2.5%. Earnings | Revenue and earnings growth improve and EPS beats at the report due 2026-11-05. | ↓Deteriorating |
| CounterHotel REIT earnings swing with travel demand, and the 10.8% miss in November 2025 shows how quickly results can fall short. | ||
A high-severity concentration risk exists in the Marriott and Hilton brand counterparties that franchise the hotels. Bear case | No adverse change in brand agreements over the next 12 months. | ↑Improving |
| CounterDependence on two franchisors gives them leverage on fees and standards, and a dispute could hit occupancy and rates. | ||
The stock is overbought (RSI 85) and only 2.4% below its 52-week high, with falling on-balance volume signaling distribution. Momentum breakdown | The price holds above the $17.66 stop while RSI cools below 70. | ↓Deteriorating |
| CounterRSI 85 with falling volume suggests buying is exhausted and a pullback is likely. | ||
Apple Hospitality converts 206% of net income into free cash flow and has an 8/9 Piotroski F-Score, supporting its dividend.
→StableQuality breakdown
- Expectation
- Free cash flow to net income stays above 150% over the next 12 months.
CounterDepreciation-heavy REIT earnings make FCF/NI look high, and no competitive moat leaves hotel demand and pricing exposed.
The price of $18.52 is 16.5% above the $15.47 analyst target, leaving negative upside against 14.3% downside.
→StableTargets
- Expectation
- Analysts raise targets above $18 or the price pulls back toward the target.
CounterA reward-to-risk of -1.16 leaves no cushion if lodging demand softens, though analyst coverage is light.
Growth scores only 3.3/10 and the last 4 quarters showed 1 beat, 2 in-line results and 1 miss, with an average surprise of 2.5%.
↓DeterioratingEarnings
- Expectation
- Revenue and earnings growth improve and EPS beats at the report due 2026-11-05.
CounterHotel REIT earnings swing with travel demand, and the 10.8% miss in November 2025 shows how quickly results can fall short.
A high-severity concentration risk exists in the Marriott and Hilton brand counterparties that franchise the hotels.
↑ImprovingBear case
- Expectation
- No adverse change in brand agreements over the next 12 months.
CounterDependence on two franchisors gives them leverage on fees and standards, and a dispute could hit occupancy and rates.
The stock is overbought (RSI 85) and only 2.4% below its 52-week high, with falling on-balance volume signaling distribution.
↓DeterioratingMomentum breakdown
- Expectation
- The price holds above the $17.66 stop while RSI cools below 70.
CounterRSI 85 with falling volume suggests buying is exhausted and a pullback is likely.
Per-dimension breakdown
Quality
5.4/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 1.8 |
| ROA | 2.2 |
| Gross margin | 4.6 |
| Op margin | 9.0 |
| Net margin | 6.1 |
| Current ratio | 1.2 |
| FCF quality | 10.0 |
| Moat | 5.2 |
| Piotroski F | 8.9 |
- ▸Excellent cash conversion: 206% FCF/NI
- ▸No competitive moat
- ▸Strong Piotroski F-Score: 8/9
Growth
3.3/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 3.7 |
| EPS growth | 2.9 |
Momentum
4.3/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.7 |
| MACD | 7.9 |
| OBV | 1.0 |
| MA position | 9.0 |
| Volume | 0.0 |
- ▸Overbought (RSI 87)
- ▸Volume distribution (falling OBV)
- ▸Above 200-day MA
Sentiment
5.5/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 6.9 |
| Price target | 4.1 |
| erm sentiment | 5.0 |
- ▸Light analyst coverage (9.0) — signal dampened
Insider
5.9/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.7 |
| notable moves | 7.0 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
Peer rank
6.2/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 2.9 |
| quality rank | 7.1 |
| growth rank | 5.8 |
- ▸Conservative debt levels
Technical
4.3/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 1.9 |
| support resistance | 0.3 |
| 52w position | 9.9 |
| gap | 5.0 |
Risk (lower is worse)
6.9/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 5.0 |
| days to cover | 4.8 |
| volatility | 7.0 |
| put call | 10.0 |
| implied vol | 6.1 |
| beta | 7.5 |
| debt equity | 7.9 |
- ▸Concentration risks: 1 HIGH (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
4.5/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 3.3 |
| earnings timing | 5.0 |
| surprise avg | 3.8 |
| dividend safety | 5.2 |
- ▸Earnings in 1 day
- ▸Dividend: 5.2%
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (5)
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (3)
- MOMENTUM:4.3<4.5
- ASYMMETRY:-1.2=NEGATIVE
- EARNINGS_PROXIMITY:1d<=7d
Warning (0)
none
Reward-to-Risk
-1.20
Upside
-18.0%
Downside
15.0%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — MCap $4.4B<$5B
Investment implication
The F-path SELL output reflects an overall score of 3.3 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Risk (lower is worse) at 6.9) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( MOMENTUM:4.3<4.5, ASYMMETRY:-1.2=NEGATIVE, EARNINGS_PROXIMITY:1d<=7d) reinforce the read. Current asymmetry R:R is -1.20 — supplementary context, not the trigger for this path.
The strongest dimensions are Risk (lower is worse) at 6.9, Peer rank at 6.2, and Insider at 5.9; the weakest are Growth at 3.3, Technical at 4.3, and Momentum at 4.3. The V9 engine flagged 3 failed gates, producing an asymmetric reward-to-risk of -1.20 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Strong Cash Conversion
Trip ifFree cash flow to net income falls below 100%.
- P2Price Above Analyst Target
Trip ifPrice falls below the $17.66 stop level.
- P3Slow Growth Mixed Earnings
Trip ifEPS surprise stays below 0% for 2 consecutive quarters.
- P4Brand Counterparty Concentration
Trip ifBrand franchise exposure to a single franchisor crosses 60% of hotel rooms with adverse terms.
- P5Overbought Near 52 Week High
Trip ifRSI stays above 85 while on-balance volume keeps falling for 2 more weeks.