Retirement REIT’s-Ryman Hospitality Properties

What does Ryman Hospitality do?

They own four upscale resorts, entertainment venues such as the Grand Ole Opry, as well as media like AM 650 based out of Nashville

The Hospitality sector includes the Gaylord Opryland Resort & Convention Center in Nashville, Tn; Gaylord Palms Resort in Florida, the Gaylord Texan Resort and Gaylord Rockies Resort near Denver, Co.

RHP also owns the Grand Ole Opry, Ryman Auditorium, Ole Red Wildhorse Saloon, and General Jackson showboat. So it’s heavily invested in the country music scene.

Lastly, they also own the radio station, AM 650. You can hear the Grand Ole Opry live on this station. Here is their website:

The Most recent Earnings Report?

It turns out they smashed the latest earnings report. Hospitality revenue increased 22.4% quarter to quarter or 24.7% year over year.

Funds from operation increased from 1.80 to 2.01 quarter to quarter. What an awesome report!

Performance at it’s Nashville and Texas resorts in particularly were just great. Both up over 10% on the quarter and year. Really the only location that lagged was the Florida location; the excuse provided was food and beverage sales at the resort were down 🙂

The entertainment side of their business was up quarter to quarter as well as yearly by over 10%.

Despite all of the good news, this company has underperformed the S&P 500 this year; returning 8.2% vs 13.5% of the market. However, this doesn’t include the return of dividends. TOTAL RETURNS.

Here is the video I did on Ryman, with my analysis:

https://youtu.be/TAqfUH-_sO8

How does the Dividend Look?

Yield: 4.88%

1 yr Growth = 5.88%

5yr Growth= 10.35%

Funds from Operation Payout = 42.68%

Comments:

The Dividend looks very safe. You can also see they are growing it at a nice pace that looks sustainable over time.

Valuation Metrics

P/E= 14.96

P/Book= 8.92

Profit Margin= 18.27%

Return on Equity= 45.74%

Price/Cash Flow = 14.81

Long term debt/Equity = 500%

Projected EPS growth = 23.79%

Comments:

The P/E ratio looks good, it’s not too high. Profit Margin and Return on Equity look fantastic as well. In addition, a substantial projected growth is expected by analysts as well.

Now on to the problem areas- Long term Debt is extremely high (500%!!!); we expect it to be high for a REIT; however, this one is sky-high. Let’s hope the low-interest rates hold and they can get some of this debt paid down. I will tell you, a large portion of the debt is from opening up the new waterpark at Opryland as well as the recent construction of the Gaylord Rockies Resort. Time will tell if the debts and money spent will provide them with the revenue return.


Closing Thoughts:

This is a small-cap REIT and you can see from its chart it has trended up for a while now. Its greatest risk is its debt load. RHP customers are primarily business meetings and upscale clients. I do believe these clients are less susceptible in the event of an economic slowdown. Also, it books rooms many years out in advance, and they already have a backlog for rooms into the next couple of years. One less thing to worry about. The performance of the new Rockies Resort in Colorado is something I want to keep an eye besides the debt. This could add even greater revenue if it pays off.

As always, I am NOT a financial advisor or professional. This website is for my own entertainment and to present my financial freedom journey. Always consult a professional before making any investment. This is not a recommendation for an investment, simply Data.

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