The target price for AHT stock implies a 50 percent downside from these levels. Now, there’s a bearish and bullish narrative for the stock. Looking at the bearish narrative, the book value of Ashford’s investments in hotels is below its debt load. This basically means that the company has negative shareholder equity and in case of a liquidation, shareholders will lose all of their money, at least theoretically.
Also, in order to derisk its balance sheet, Ashford has been converting preferred shares into common shares. While it would help lower the dividend payments towards the preferred shares, it will also lead to dilution.
View more information: https://marketrealist.com/p/why-aht-stock-dropping-how-low/