INN enters its Q1 2026 earnings report today having staged a notable recovery — up 14% over the past month to $4.97 — yet short sellers have been retreating in step with that move.
The most striking data point in the setup is just how aggressively shorts have unwound. Short interest has been nearly halved over the past month, falling 52% to 2.8% of the free float. The bulk of that compression happened in a single week around April 10, when reported shares short dropped from roughly 6.2 million to 3.3 million. That drawdown continued into last week, with SI falling another 9.5%. The lending market reflects the same looseness: availability is extremely wide, borrow costs run at just 0.5% annualised, and the ORTEX short score has drifted down to 33.9 — well below the midpoint of its 0–100 range. There is no meaningful squeeze pressure here and no indication that the short community is pressing a thesis into the print.
Options positioning adds a mild note of caution to an otherwise relaxed setup. The put/call ratio has climbed to 0.39, above its 20-day average of 0.23 by roughly one standard deviation — elevated relative to recent history, but nowhere near the defensive extreme of 1.82 seen at the 52-week high. Peers have broadly moved in the same direction this week: PEB gained nearly 5%, added 4.7%, and rose 3.9%, suggesting the sector tailwind behind INN's recent recovery is real rather than idiosyncratic.
The analytical backdrop is largely stale — the most recent analyst actions date to late 2025, with B of A downgrading to Underperform and cutting its target to $4.50 back in November. The stock has since recovered above that level. The consensus mean target of $5.375 sits modestly above the current price, implying limited upside in the Street's collective view. Valuation context is mixed: the EV/EBITDA multiple of 13.2x has compressed slightly over the past month, while price-to-book at 0.50x reflects the discount the market continues to assign to this lower-end hotel REIT relative to its net asset value. The last confirmed earnings reaction — the February 2026 print — produced a 5.4% one-day gain and a 10% five-day move, suggesting the stock can respond sharply to a positive surprise.
Today's print will test whether the operational momentum that drove insiders to add shares through early 2026 — CEO Jonathan Stanner disclosed a position of nearly 2.1 million shares as of March — is showing up in revenue per available room and margins, or whether the macro uncertainty that pushed B of A to the sidelines is beginning to weigh on bookings.
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