Chatham Lodging Trust reported adjusted funds from operations of $0.48 per share, a 22% rise that far exceeds the $0.09 consensus EPS estimate, indicating robust cash generation. The lift supports higher dividend payouts and reinforces the REIT’s capacity to fund share buybacks, a key draw for income‑seeking investors.

Key Highlights

  • AFFO $0.48 per share · Next catalyst: Q3 earnings release
  • AFFO per diluted share rose 22% to $0.48, while adjusted EBITDA climbed 15% to $33 million
  • RevPAR increased >3% to $158, and net income doubled to $6 million year‑over‑year
  • Repurchased 0.3 million shares under a $25 million buy‑back plan

Chatham Lodging Trust (NYSE: CLDT) reported adjusted funds from operations of $0.48 per share for the quarter ended June 30, 2026, marking a 22% increase over the prior period. The REIT also elevated RevPAR by more than three percent, reaching $158, and net income attributable to common shareholders doubled to $6 million.

AFFO Surge Beats Consensus

AFFO per diluted share advanced from $0.39 in the comparable prior period to $0.48, reflecting a 22% uplift. This improvement lifted total AFFO for the quarter to $24 million, up from $20 million a year earlier. The higher per‑share figure results from better operating margins and the treatment of share‑based compensation within the adjusted measure, offering a clearer view of cash available for distributions and supporting the continued $0.10 per‑share dividend.

Margin Expansion and Revenue Growth

Gross operating profit margins improved by 50 basis points, reaching 47%, while hotel EBITDA margins rose by 220 basis points to 41% for the quarter. Adjusted EBITDA increased by over $4 million, a 15% gain, arriving at $33 million. RevPAR climbed to $158, aided by a 390‑basis‑point rise in average daily rate to $195, even as occupancy slipped by 50 basis points to 81%.

The portfolio’s Silicon Valley hotels posted a 7% RevPAR gain, and the recently acquired six‑hotel group delivered a 9% surge.

Strong Shareholder Return Strategy

During the quarter the trust repurchased 0.3 million shares as part of its $25 million buy‑back program. This ongoing repurchase effort, combined with the stronger AFFO, provides flexibility to return capital while preserving liquidity for future growth initiatives, thereby enhancing earnings per share and supporting dividend sustainability.

Outlook and Upcoming Catalyst

Looking ahead, analysts will assess whether RevPAR can maintain its recent momentum and if margins stay strong amid potential cost pressures. Management has indicated construction activity on a new Home2 Suites by Hilton, adding pipeline growth, though execution risk remains. The ability to translate current cash‑flow strength into continued dividend growth and share‑buyback capacity will be a key focus for investors evaluating the lodging REIT sector.

Peers Moving on This News

  • Sunstone Hotel Investors Inc (SHO) down 0.3%
  • RLJ Lodging Trust (RLJ) little changed
  • Xenia Hotels & Resorts Inc (XHR) down 0.3%

Analysis based on the Form 8-K filed 4 August 2026; figures verified against the filing and live market data.

This article is for informational purposes only and does not constitute financial advice. Please consult a licensed financial adviser before making investment decisions.