Pebblebrook Hotel Trust heads into late May carrying fresh upgrade momentum — Truist Securities flipped to Buy this morning with a $17 target, the most bullish call on the name in months, arriving just as the stock is touching its best levels of the spring.
The upgrade from Truist's Gregory Miller — from Hold to Buy, with the target moving from $14 to $17 — is the sharpest turn in analyst sentiment since the earnings wave in late April. It is notable for the timing: the stock closed at $15.12 on Tuesday, up 5.9% on the week and 8.3% over the past month, and Miller's new $17 target now sits roughly 12.5% above the current price. The broader analyst picture remains mixed. Morgan Stanley has maintained Underweight throughout, raising its target from $10 to $12 in mid-May but still implying meaningful downside. Citi, Cantor, and Evercore all edged targets higher — to $15 — after Q1 results in late April, while Stifel holds at $16.25 with a Buy. The consensus sits at Hold, with three buys against seven holds and no outright sells among tracked analysts. The mean target of $14.55 is now below the current price, but Truist's fresh $17 sets the outer bull case if the urban hotel recovery thesis gets traction.
The bulls point to improving net asset values in San Francisco, stronger-than-expected EBITDA from legacy properties, and evidence of market share gains. The bears push back hard on geographic concentration — Boston, Los Angeles, San Francisco, San Diego, and South Florida all remain exposed to depressed international inbound demand — and question whether incremental EBITDA from heavy capex programs will materialise fast enough to justify a re-rating. The EV/EBITDA multiple currently runs at 11.9x, up slightly on the week, with price-to-book at 0.71x — cheap relative to history, but the negative PE and weak EBIT quality scores (EV/EBIT factor at the 15th percentile) reflect genuine underlying earnings pressure.
Short interest at 12.85% of the float is meaningful, but the direction of travel is working against the bears. Shorts have trimmed roughly 3% of their position over the past month. The reduction accelerated after the stock broke above $14 post-earnings, with the peak short position in mid-April — above 15.9 million shares — now unwound to around 14.6 million. Borrow remains easy. Availability is running at 641%, close to a six-week high, meaning there is no supply squeeze to force further covering — any additional reduction is short sellers choosing to leave, not being squeezed out. Cost to borrow has edged up about 5% on the week to 0.54%, but that is still historically low. The options market echoes the same cautious-but-not-panicked tone: the put/call ratio of 2.05 runs modestly above its 20-day average and sits well off the 52-week high of 4.62.
The sector context matters. Close peers RLJ and PK gained 7.9% and 8.2% respectively on the week, slightly outpacing PEB's 5.9%. APLE and SHO rose closer to 5%, while HST added 5.7%. The bid has been broad-based — this is not a PEB-specific story this week, but a sector re-rating. That matters because it raises the question of whether PEB, given its elevated short interest versus peers and its concentrated urban exposure, has more catch-up potential or simply more tail risk if the sector rally fades.
Q2 earnings are due July 24. Between now and then, the Truist upgrade and the broader sector rally give PEB a cleaner technical backdrop than it has had all year. What to watch: whether further short covering extends the move, or whether the 12.85% float short — still high relative to peers — reasserts as a cap once the immediate catalyst fades.
See the live data behind this article on ORTEX.
Open PEB on ORTEX →ORTEX Market Intelligence content is generated by AI from a snapshot of ORTEX's proprietary data. Content is informational only and does not constitute investment advice.
