# Service Properties Trust (SVC.US)

Canonical: https://gigainvestors.com/s/SVC

Analysis as of: 2026-10-16T07:32:11.237Z. Financial observations: FY1996–FY2025.

Listing currency: USD. Reporting currency: USD.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: fail; earnings resilience is evidence only). Published buy qualification: no.

Share price: $6.19 per share; close as of 2026-10-15.

Estimated value: low $8.69 per share, central $9.89 per share, high $11.49 per share. Buy at or below the central value $9.89 per share. Valuation as of 2026-10-16T07:32:11.237Z; scenarios are not confidence intervals.

Expected annual return: 14.4% at the stated quote. About 14.4% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; US 10-year bond 5.1% + 4 points).

## Checklist

### understandable: fail

- 2 revenue declines in the last 10 years (informational)

- more than 2 net loss years

- operating margin variation exceeds 0.35

- Financial history: 10 years

- Years with declining revenue: 2

- Years with a net loss: 6

- Operating margin variation: 0.83×

Chart: Operating margin; fiscal year observations.

- FY2016: 0.19×

- FY2017: 0.18×

- FY2018: 0.17×

- FY2019: 0.37×

- FY2020: 0.00×

- FY2021: -0.05×

- FY2022: 0.09×

- FY2023: 0.11×

- FY2024: 0.10×

- FY2025: 0.12×

### moat: fail

- ROIC median below threshold

- ROIC worst years below threshold (more than 1 bad year allowed)

- Recent gross margin fell 5.1pp below the typical margin (limit 4pp)

- ROIC, median of available years: 2.7%

- ROIC, second-lowest year: 0.0%

- Typical minus recent gross margin: 5.1 pp

- Typical gross margin (annual median): 36.4%

- Recent gross margin (lower of latest and 3-year median): 31.2%

- Years with nonpositive capital: 0

- Capital spending / revenue: 5.9%

- ROIC including acquisitions, ten-year median: 2.5%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2016: 6.0%

- FY2017: 5.6%

- FY2018: 5.8%

- FY2019: 9.8%

- FY2020: 0.0%

- FY2021: -0.7%

- FY2022: 2.0%

- FY2023: 2.4%

- FY2024: 2.3%

- FY2025: 2.9%

### economics: fail

- incremental invested capital return below threshold

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: $528M

- Net income, five-year total: -$1.2B

- Return on incremental invested capital: 0.0%

- Working capital / revenue, annual change: -2.7 pp

- Working capital / revenue, change between three-year averages: -18.1 pp

- Working capital / revenue, final three-year average: -23.4%

Chart: Owner earnings · five years; fiscal year observations.

- FY2021: -$154M

- FY2022: $218M

- FY2023: $255M

- FY2024: $96M

- FY2025: $113M

### management: fail

- Historical market-dollar context (not the management verdict): 2016 to 2025 (9 years)

- potential debt-funded buybacks (informational)

- buybacks unrelated to price (informational)

- ROIC first 3 years vs last 3 years: 5.8% vs 2.4%

- Per-share earnings: 1.31 to -1.22 (three-year endpoint medians)

- per-share value declined or ends nonpositive

- acquired goodwill and intangibles (proxy) exceeds half of ten-year net income with low and deteriorating ROIC

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: 0.9%

- Ordinary dilution, 5-year annual growth: 0.2%

- Market cap gain: -$981M

- Cumulative retained earnings: -$2.2B

- Diluted shares, 10-year annual growth: 0.9%

- Diluted shares, 5-year annual growth: 0.2%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2025

- Per-share value change: -$2.53

- Per-share value, starting three-year median: $1.31

- Per-share value, ending three-year median: -$1.22

- Buybacks concentrated in cheaper years (correlation): -0.43

- Average buyback yield: 3.3%

- Buyback history: 10 years

- Debt-funded buybacks: Yes

- Acquisition spending: $334M

- Cumulative net income, 10 years: -$615M

- ROIC, first three-year median: 5.8%

- ROIC, last three-year median: 2.4%

Chart: Earnings per share; fiscal year observations.

- FY2016: $1.43

- FY2017: $1.31

- FY2018: $1.13

- FY2019: $1.58

- FY2020: -$1.90

- FY2021: -$3.31

- FY2022: -$0.80

- FY2023: -$0.20

- FY2024: -$1.67

- FY2025: -$1.22

### accounting: pass

- Sloan accruals: -4.9%

- Receivables to sales index (DSRI): 0.06×

- Restructuring years, last five: 1

- Stock compensation / operating cash flow: 0.0%

- Earnings backed by cash: Yes

- Accounting red flags: 0

- Goodwill and intangibles / equity: 0.15×

Chart: Sloan accruals; fiscal year observations.

- FY2016: -4.7%

- FY2017: -4.7%

- FY2018: -5.7%

- FY2019: -4.0%

- FY2020: -4.0%

- FY2021: -6.5%

- FY2022: -5.0%

- FY2023: -7.0%

- FY2024: -5.8%

- FY2025: -4.9%

## Holders

- [Howard Marks](https://gigainvestors.com/oc): tracked 13F investor; follow the investor page for holding quarter and amounts.

## Price story

Down 44% since Feb 2023 · sales -4.3%

Story as of 2026-10-16T09:59:38.826Z; price observation 2026-10-15.

Price needs cash profits to shrink 5% a year for ten years

### Sales · FY2024–2025

sales -4.3%; source https://www.sec.gov/Archives/edgar/data/945394/000094539426000012/svc-20251231.htm; observed 2026-02-25.

- FY2016: $2.0B 

- FY2017: $2.2B 

- FY2018: $2.3B 

- FY2019: $2.3B 

- FY2020: $1.3B 

- FY2021: $1.5B 

- FY2022: $1.9B 

- FY2023: $1.9B 

- FY2024: $1.9B 

- FY2025: $1.8B 

### Gross margin · FY2025

gross margin 31.2%; source https://www.sec.gov/Archives/edgar/data/945394/000094539426000012/svc-20251231.htm; observed 2026-02-25.

- FY2016: 41.3% 

- FY2017: 41.1% 

- FY2018: 39.3% 

- FY2019: 39.0% 

- FY2020: 46.0% 

- FY2021: 31.4% 

- FY2022: 33.4% 

- FY2023: 33.7% 

- FY2024: 31.8% 

- FY2025: 31.2% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in property rentals; annual sales are USD 1.8 billion.

- Source: https://www.sec.gov/Archives/edgar/data/945394/000094539426000012/svc-20251231.htm (filed 2026-02-25); FY2025: revenue 1814838000; grossProfit 566699000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-15); SVC.US: Service Properties Trust is a real estate investment trust with 9.7 billion Dollar invested in two asset categories: service-focused retail net lease properties and hotels. As of June 30, 2026, SVC owned 745 service-focused retail net lease properties with over 13.5 million square feet throughout the United States and 93 hotels with over 21,000 guest rooms throughout the United States, including Puerto Rico, and Canada. SVC is managed by The RMR Group, a leading U.S. alternative asset management company with over 37 billion Dollar in assets under management as of June 30, 2026, and 40 years of institutional experience in buying, selling, financing and operating commercial real estate. SVC is headquartered in Newton, Massachusetts. Service Properties Trust was established in 1995 and was incorporated in Maryland.

### Why customers stay

Margins ranged from 31.2% to 33.7% during 2023–25; it earns 2.7% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-25); FY2023: grossProfit / revenue = 33.7%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-25); FY2024: grossProfit / revenue = 31.8%.

- Source: https://www.sec.gov/Archives/edgar/data/945394/000094539426000012/svc-20251231.htm (filed 2026-02-25); FY2025: grossProfit / revenue = 31.2%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-25); 10-year return on capital observations [[2016,0.06048864357924337],[2017,0.05649261749013826],[2018,0.05808299318436826],[2019,0.09832312804911518],[2020,0.00027330503536760164],[2021,-0.007153852353892074],[2022,0.019954906919872287],[2023,0.024403825693692913],[2024,0.023498186815771822],[2025,0.028841684989106685]]; median 0.0266227553413998. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Paid dividends in 10 of 10 years; bought back USD 660000 of shares.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-25); FY2016: growth capex 93265000; upkeep 357342000; owner earnings 223110000. Growth capex / owner earnings = 0.41802250011205233.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-25); FY2017: growth capex 315716000; upkeep 386659000; owner earnings 215143000. Growth capex / owner earnings = 1.467470473127176.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-25); FY2018: growth capex 0; upkeep 310565000; owner earnings 278246000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-25); FY2020: growth capex 0; upkeep 69082000; owner earnings 118444000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-25); FY2022: growth capex 0; upkeep 50422000; cash acquisitions 45470000; owner earnings 218305000. Growth capex plus acquisitions / owner earnings = 0.20828657153981814.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-25); FY2023: growth capex 0; upkeep 96758000; cash acquisitions 0; owner earnings 254523000. Growth capex plus acquisitions / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-25); FY2024: growth capex 0; upkeep 0; cash acquisitions 15266000; owner earnings 96260000. Growth capex plus acquisitions / owner earnings = 0.1585913151880324.

- Source: https://www.sec.gov/Archives/edgar/data/945394/000094539426000012/svc-20251231.htm (filed 2026-02-25); FY2025: growth capex 0; upkeep 0; cash acquisitions 0; owner earnings 112642000. Growth capex plus acquisitions / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-25); Dividend observations: [[2016,334799000],[2017,346685000],[2018,346832000],[2019,353619000],[2020,93804000],[2021,6596000],[2022,38044000],[2023,132430000],[2024,101150000],[2025,6683000]]. Zero only counted when supported by a complete cash-flow statement.

- Source: https://www.sec.gov/Archives/edgar/data/945394/000094539426000012/svc-20251231.htm (filed 2026-02-25); FY2025: cash repurchases 660000 USD.

### Are managers owners

Insiders own 0.6% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-15); SVC.US SharesStats.PercentInsiders = 0.6 percentage points; cache date 2026-10-15.

### What the price says

The price assumes cash profits shrink 5% yearly over ten years; actual decline was 4.7%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-25); Ten-year compound average after fade. Initial solved rate -0.08299665012479834. Price 6.19; FX 1; discount 0.1; same standard ten-year fade to terminal 0.03. FY2015 owner earnings/share 1.1020913630283042 → FY2025 0.6787666238829534. Closing-price date 2026-10-15.

## Monthly share-price history (USD per share)

- 2016-10: $27.36 per share

- 2016-11: $29.00 per share

- 2016-12: $31.74 per share

- 2017-01: $31.13 per share

- 2017-02: $31.78 per share

- 2017-03: $31.53 per share

- 2017-04: $31.83 per share

- 2017-05: $28.92 per share

- 2017-06: $29.15 per share

- 2017-07: $29.06 per share

- 2017-08: $27.36 per share

- 2017-09: $28.49 per share

- 2017-10: $28.58 per share

- 2017-11: $29.99 per share

- 2017-12: $29.85 per share

- 2018-01: $28.41 per share

- 2018-02: $25.44 per share

- 2018-03: $25.34 per share

- 2018-04: $24.88 per share

- 2018-05: $28.95 per share

- 2018-06: $28.61 per share

- 2018-07: $28.27 per share

- 2018-08: $28.99 per share

- 2018-09: $28.84 per share

- 2018-10: $25.62 per share

- 2018-11: $26.84 per share

- 2018-12: $23.88 per share

- 2019-01: $26.66 per share

- 2019-02: $27.07 per share

- 2019-03: $26.31 per share

- 2019-04: $26.00 per share

- 2019-05: $24.87 per share

- 2019-06: $25.00 per share

- 2019-07: $24.71 per share

- 2019-08: $24.14 per share

- 2019-09: $25.79 per share

- 2019-10: $25.30 per share

- 2019-11: $23.29 per share

- 2019-12: $24.33 per share

- 2020-01: $21.58 per share

- 2020-02: $18.08 per share

- 2020-03: $5.40 per share

- 2020-04: $6.93 per share

- 2020-05: $6.75 per share

- 2020-06: $7.09 per share

- 2020-07: $6.70 per share

- 2020-08: $8.21 per share

- 2020-09: $7.95 per share

- 2020-10: $7.21 per share

- 2020-11: $11.86 per share

- 2020-12: $11.49 per share

- 2021-01: $10.61 per share

- 2021-02: $12.84 per share

- 2021-03: $11.86 per share

- 2021-04: $12.32 per share

- 2021-05: $12.56 per share

- 2021-06: $12.60 per share

- 2021-07: $11.13 per share

- 2021-08: $11.43 per share

- 2021-09: $11.21 per share

- 2021-10: $10.77 per share

- 2021-11: $8.51 per share

- 2021-12: $8.79 per share

- 2022-01: $8.55 per share

- 2022-02: $8.63 per share

- 2022-03: $8.83 per share

- 2022-04: $8.12 per share

- 2022-05: $6.33 per share

- 2022-06: $5.23 per share

- 2022-07: $6.54 per share

- 2022-08: $6.84 per share

- 2022-09: $5.19 per share

- 2022-10: $8.11 per share

- 2022-11: $7.85 per share

- 2022-12: $7.29 per share

- 2023-01: $8.91 per share

- 2023-02: $10.98 per share

- 2023-03: $9.96 per share

- 2023-04: $8.77 per share

- 2023-05: $8.21 per share

- 2023-06: $8.69 per share

- 2023-07: $8.49 per share

- 2023-08: $8.26 per share

- 2023-09: $7.69 per share

- 2023-10: $7.25 per share

- 2023-11: $7.15 per share

- 2023-12: $8.54 per share

- 2024-01: $7.73 per share

- 2024-02: $6.80 per share

- 2024-03: $6.78 per share

- 2024-04: $6.13 per share

- 2024-05: $5.38 per share

- 2024-06: $5.14 per share

- 2024-07: $5.67 per share

- 2024-08: $4.69 per share

- 2024-09: $4.56 per share

- 2024-10: $3.20 per share

- 2024-11: $2.78 per share

- 2024-12: $2.54 per share

- 2025-01: $2.85 per share

- 2025-02: $2.98 per share

- 2025-03: $2.61 per share

- 2025-04: $1.80 per share

- 2025-05: $2.32 per share

- 2025-06: $2.39 per share

- 2025-07: $2.63 per share

- 2025-08: $2.70 per share

- 2025-09: $2.71 per share

- 2025-10: $2.14 per share

- 2025-11: $1.74 per share

- 2025-12: $1.84 per share

- 2026-01: $1.99 per share

- 2026-02: $2.30 per share

- 2026-03: $1.36 per share

- 2026-04: $1.55 per share

- 2026-05: $1.79 per share

- 2026-06: $1.69 per share

- 2026-07: $8.03 per share

- 2026-08: $7.80 per share

- 2026-09: $6.44 per share

- 2026-10: $6.19 per share

## Annual estimated value (USD per share)

- FY2016: low $15.62 per share, central $17.78 per share, high $20.65 per share

- FY2017: low $14.32 per share, central $16.30 per share, high $18.93 per share

- FY2018: low $16.64 per share, central $18.93 per share, high $21.99 per share

- FY2019: low $16.79 per share, central $21.11 per share, high $24.65 per share

- FY2020: low $8.63 per share, central $9.78 per share, high $11.32 per share

- FY2021: low $14.85 per share, central $16.14 per share, high $17.84 per share

- FY2022: low $11.58 per share, central $13.17 per share, high $15.30 per share

- FY2023: low $12.49 per share, central $14.09 per share, high $16.22 per share

- FY2024: low $12.38 per share, central $14.00 per share, high $16.15 per share

- FY2025: low $9.29 per share, central $10.31 per share, high $11.67 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

Prior published observations retained from 2026-10-15T06:37:56.307Z where newer inputs omit a numeric field or fiscal period.

## Sources

[Original 10-K filing](https://www.sec.gov/Archives/edgar/data/945394/000094539426000012/svc-20251231.htm); period 2025-12-31, filed 2026-02-25.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.