Diamondrock Hospitality Company Stock Earnings Reports

DiamondRock reported a third quarter that modestly beat expectations: corporate adjusted EBITDA was $79.1M and adjusted FFO per share was $0.29. Comparable RevPAR declined 0.3% but out-of-room revenues grew 5.1%, driving total RevPAR growth of 1.5%. Food & beverage was a standout with revenue up 4% and margins expanding 180 bps. Urban hotels (60%+ of EBITDA) showed slight RevPAR growth; resorts showed a small RevPAR decline but improved EBITDA margins (150+ bps). Group room revenue was down 3.5% but booking momentum improved — 38% more groups booked for the remainder of the year versus a year ago and 2026 group pace is up mid-to-high single digits with ~60% of 2026 group revenue already on the books. Balance sheet actions: refinanced and upsized the senior unsecured credit facility, paid off last two mortgages, portfolio is now unencumbered by secured debt, all debt is prepayable, earliest maturity 2029; 30% fixed / 70% floating (including swaps). Capital allocation: YTD repurchased 4.8M shares (~$37M, $7.72 average), expect >$150M cash at year-end, see share repurchases and/or redemption of preferred as attractive uses of capital. Guidance: tightened ranges and raised midpoints — adjusted EBITDA midpoint raised ~$6M to $287M–$295M and adjusted FFO per share midpoint raised $0.03 to $1.02–$1.06. Strategy & outlook: disciplined, lower CapEx approach (targeting 7–9% of revenue vs. peers ~10.5%), emphasis on ROI-driven renovations (example: $21k per key renovation in Phoenix; $25M Cliffs renovation expected to deliver a 10% yield on cost), will be opportunistic in the transaction market but currently prefer share buybacks over paying current market prices for acquisitions. 2026 outlook: several portfolio-specific tailwinds (renovation comp benefit, FIFA World Cup market exposure, strong group pace) and industry tailwinds (easier comps, holiday calendar) that should support stronger performance next year. Risks include the federal government shutdown (moderated Q4 expectations) and general market/valuation dynamics for acquisitions and dispositions.