Well covered — hotels paying a regular dividend plus specials. A 3.24% yield on the regular $0.20 quarterly dividend is covered several times over by Adjusted FFO: the $0.80 regular annual dividend is about 37% of the $2.165 midpoint of 2026 Adjusted FFO guidance. Q2 Adjusted FFO was $0.63 per share, comparable hotel RevPAR rose 7.0%, and leverage was about 2.2×. The yield here uses the regular dividend only — Host also paid a $0.72 special dividend in July 2026, which is not counted as recurring income.
Key risk: Lodging cyclicality — hotel cash flow swings with travel demand, so if RevPAR reverses, Adjusted FFO falls faster than apartment or grocery rent would, and the special dividends disappear first.
Changes if: Adjusted FFO payout on the regular dividend pushes well past ~37%, or comparable RevPAR turns negative. The cushion, not the headline yield, is the tripwire.
- ✓FFO coverage check: Adjusted FFO guidance of $2.15–$2.18 per share for 2026 covers the $0.80 regular annual dividend — about 37% paid out at the midpoint. Special dividends are excluded from this payout.
- ✓Yield check: 3.24% indicated — $0.20/qtr × 4 at the $24.72 close on Oct. 23, 2026, regular dividend only. The $0.72 July 2026 special dividend is real cash but not recurring, so it is not in the yield.
- ✓Balance-sheet check: Leverage of about 2.2× after the July 2026 distributions, with comparable hotel RevPAR up 7.0% and comparable hotel EBITDA margin of 31.9% in Q2.
What this grade doesn't say: It screens the dividend only — covered, real, compounding. It says nothing about valuation or price: a well-covered payer can still be overpriced, and its price can still fall.