RHP - Embedded Expectations Analysis - 2020 06 29
Ryman Hospitality Properties, Inc. (RHP:USA) currently trades below recent averages relative to UAFRS-based (Uniform) assets, with a 1.3x Uniform P/B. At these levels, the market is pricing in somewhat bearish expectations for the firm, and management may have concerns about booking cancellations, ensuring adequate liquidity, and their customer and meeting planner servicesSpecifically, management may lack confidence in their ability to rebook coronavirus-driven cancellations and ensure a good guest satisfaction experience with minimal staffing levels. In addition, they may be exaggerating the durability of fellowship and travel demand and their ability to deliver on customer and meeting planner needs, and they may be downplaying concerns about declines in net occupancy rates. Furthermore, they may lack confidence in their ability to execute their customer outreach, enforce new safety protocols, and maintain adequate liquidity. Finally, they may have concerns about the amended terms of their secured credit facility covenants, volumes related to their “fly-in†market, and their discussions with Marriott about business improvements
Ryman Hospitality Properties is a real estate investment trust that is focused on group-oriented, destination hotel assets in urban and resort markets. The company's business segments include Hospitality and Entertainment. The Hospitality segment includes the Gaylord Hotels branded hotels, the Inn at Opryland and the AC Hotel, as well as the company's equity investment in Gaylord Rockies Resort & Convention Center. The Entertainment segment includes the Grand Ole Opry, the Ryman Auditorium, WSM-AM, Ole Red, the General Jackson, the Wildhorse Saloon, and Gaylord Springs, among others.
In 2009, just as the dust was settling from the last major equity and credit market crises, we launched a boutique research firm with the intention of breaking Wall Street’s biases and broken incentives:
- GAAP and IFRS have failed to provide rules for reliable financial statement reporting
- Stock analyst recommendations are not grounded in disciplined financial analysis
- Credit agencies have been set up to grossly fail in their responsibilities to investors and the public markets
- Utter lack of willingness of major research firms to employ the the most advanced forensic analysis available
We sought to provide investors and company analysts with a source of information that changed all that.
Many years later, our business model remains because little has changed on Wall Street.
- Corporate credit ratings remain years behind the fundamental underpinnings of company performance
- Stock analysts continue to make recommendations with deeply inherent biases
- Research firms have failed to break down the walls between credit, equity, and macroeconomic research
- The governing accounting bodies have created more leeway for mis-estimates and mis-classifications as financials have become unwieldy and overwhelming
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