Host Hotels & Resorts, Inc. HST reported third-quarter 2018 adjusted funds from operations (FFO) of 37 cents per share, which outpaced the Zacks Consensus Estimate of 35 cents. Adjusted FFO per share also increased 12.1% from the year-ago tally of 33 cents.The company generated total revenues of around $1.3 billion, which surpassed the Zacks Consensus Estimate of $1.28 billion, and increased 3.6% year over year.Results reflect improvements in food and beverage sales, as well as operations of the three hotel Hyatt portfolio acquired in 2018. These were partly muted by the disposition of eight hotels in 2017 and 2018. The company also experienced broad productivity gains that aided profitability.Behind the HeadlinesDuring the quarter under review, comparable hotel revenues increased 2.8% year over year to around $1.1 billion. Comparable hotel RevPAR (on a constant dollar basis) was up 1.6% year over year, aided by a 1.5% increase in average room rate and an expansion of 10 basis points (bps) in occupancy. For domestic properties, comparable hotel RevPAR was up 1.4%, while the same for International properties climbed 10.8%.For the Sep-end quarter, comparable hotel EBITDA increased 4.6%. Comparable hotel EBITDA margin advanced 50 bps.Finally, the company exited third-quarter 2018 with around $1.27 billion of unrestricted cash, not including $205 million in the FF&E escrow reserve, and $702 million of available capacity under the revolver part of its credit facility. In addition, as of Sep 30, 2018, total debt was $4.1 billion, having an average maturity of 4.3 years and an average interest rate of 4.1%. Notably, the company has no debt maturities until 2020.Host Hotels did not buy back any shares in 2018. It has $500 million of capacity available under its current repurchase program. Additionally, earlier the company entered into a distribution agreement through which it may issue and sell shares of common stock, having a total offering price of up to $500 million from time to time. So far this year, no shares have been issued under this agreement.Portfolio ActivityNotably, during the reported quarter, Host Hotels made efforts to enhance its portfolio quality through strategic dispositions, aiming at lowering the company’s international and New York exposure. It sold the JW Marriott Hotel Mexico City and reached a deal to sell its interest in the European joint venture to its present partners. Further, in New York, the company accomplished the sale of the W New York – Union Square, as well as placed the Westin New York Grand Central hotel under contract for $300 million, including FF&E funds. Also, the company sold the retail space at the New York Marriott Marquis to Vornado Realty Trust VNO, for $442 million.The asset sales that have already closed, as well as those that the company expects to complete, aggregate around $1.2 billion. With these proceeds, the company has flexibility to add properties to its portfolio, invest in existing assets or go for share repurchases.Capital InvestmentsDuring the Jul-Sep quarter, the company expended around $119 million on capital expenditures — $48 million was return on investment (ROI) capital projects, and $71 million for renewal and replacement projects.OutlookHost Hotels has revised its outlook for full-year 2018. The company now expects 2018 adjusted FFO per share of $1.74-$1.76, denoting a 1.5-cent increase at the mid-point from the earlier guidance of $1.71-$1.76. The Zacks Consensus Estimate for the same is currently pegged at $1.75.The company’s full-year projection includes comparable hotel RevPAR (constant U.S. dollar basis) growth of 1.9-2.1%, reflecting a contraction of 12.5 bps at the mid-point. Additionally, the company projects capital expenditures of $475-$520 million for the year. This comprises $195-$220 million in ROI projects, and $280-$300 million in renewal and replacement projects.In ConclusionWe are encouraged with the better-than-anticipated performance of Host Hotels in the third quarter. Although the company has a solid portfolio of upscale hotels across potential markets and focuses on strategic capital-recycling efforts, elevated supply in some of the company’s key markets is expected to affect its pricing power. Moreover, dilutive impact on earnings from sale of assets and hike in interest rate adds to its woes.Host Hotels currently has a Zacks Rank #4 (Sell).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Host Hotels & Resorts, Inc. Price, Consensus and EPS Surprise Host Hotels & Resorts, Inc. Price, Consensus and EPS Surprise | Host Hotels & Resorts, Inc. QuoteWe, now, look forward to the earnings releases of Lamar Advertising Company LAMR, Host Omega Healthcare Investors, Inc. OHI and Outfront Media Inc. OUT, all of which are scheduled to report their quarterly numbers next week.Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.Today's Stocks from Zacks' Hottest StrategiesIt's hard to believe, even for us at Zacks. 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