RLJ Stock Is Down 8% in a Year, but This $71 Million Position Signals Conviction
Key Points
Connecticut-based H/2 Credit Manager added 3,278,927 RLJ shares in the fourth quarter; the estimated trade size was $23.83 million based on quarterly average prices.
Meanwhile, the quarter-end position value rose by $26.00 million, reflecting both trading and price changes.
The post-trade RLJ stake stood at 9,583,184 shares, valued at $71.39 million.
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On February 17, 2026, Connecticut-based H/2 Credit Manager disclosed a buy of 3,278,927 shares of RLJ Lodging Trust (NYSE:RLJ), with an estimated transaction value of $23.83 million based on quarterly average pricing.
What happened
According to a SEC filing dated February 17, 2026, H/2 Credit Manager LP increased its stake in RLJ Lodging Trust (NYSE:RLJ) by 3,278,927 shares. The estimated value of this buy, based on the average closing price for the quarter, was approximately $23.83 million. The fund’s RLJ position value at quarter-end was $71.39 million, a net increase of $26.00 million from the prior period, reflecting both new purchases and stock price movement.
What else to know
- Top five holdings after the filing:
- NYSE: VRE: $81.44 million (17.8% of AUM)
- NASDAQ: DHC: $72.35 million (15.8% of AUM)
- NYSE:RLJ: $71.39 million (15.6% of AUM)
- NYSE: INN: $44.45 million (9.7% of AUM)
- NASDAQ: DRH: $36.51 million (8.0% of AUM)
- As of February 17, 2026, RLJ shares were priced at $8.29, down 7.9% over the past year and underperforming the S&P 500 by 18.03 percentage points.
Company overview
| Metric | Value |
|---|---|
| Revenue (TTM) | $1.35 billion |
| Net income (TTM) | $33.45 million |
| Dividend yield | 7.14% |
| Price (as of market close February 17, 2026) | $8.29 |
Company snapshot
- RLJ Lodging Trust owns and operates a portfolio of premium-branded, focused-service and compact full-service hotels, generating revenue primarily from room rentals and related services.
- The company operates as a real estate investment trust (REIT), earning income through hotel property ownership and management, with a focus on high-margin, select-service assets.
- It targets business and leisure travelers across U.S. states and the District of Columbia, serving a broad range of corporate, group, and transient guests.
RLJ Lodging Trust is a self-advised REIT specializing in the ownership of premium-branded hotels. The company's strategy emphasizes high-margin, select-service properties in diverse U.S. markets, supporting stable cash flows and a competitive dividend yield. RLJ's disciplined approach provides exposure to the lodging sector with a focus on operational efficiency and geographic diversification.
What this transaction means for investors
Balance sheet risk sometimes defines REIT returns more than room rates, and that is especially true in lodging, where cash flows swing with the cycle and refinancing windows can make or break equity value.
On that front, RLJ just removed a major overhang. The company just refinanced all debt maturities through 2028, extended its $600 million revolver to 2031, added new term capacity maturing in 2033, and positioned itself to retire $500 million of senior notes due in July. The next meaningful maturity is now pushed to 2029. In a higher-rate environment, that kind of runway matters.
The stock sits at $8.29, down about 8% over the past year and trailing the S&P 500. Yet this position now ranks among the top holdings, alongside other REIT and asset-heavy names, suggesting a clear tilt toward real estate and credit-sensitive plays rather than high-growth biotech. Ultimately, if refinancing risk is off the table and lodging demand stabilizes, upside can come from multiple expansion and improved free cash flow visibility. The risk, however, remains cyclical exposure.
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Jonathan Ponciano has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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