UPDATE: Deutsche Bank Initiates Coverage on Hilton Worldwide

In a report published Tuesday, Deutsche Bank analyst Carlo Santarelli initiated coverage on

with a Buy rating, establishing a $27.00 price target. According to the report, the target price is based on a sum of the parts analysis, while the coverage initiation reflects a number of factors. “While we anticipate many will clamor that the bull case for meaningful upside in HLT from current levels is the optionality from asset monetization, something we detail later in this report, we find: 1) the industry bull case, especially given HLT's domestic owned exposure and leverage to accelerating ADR's at current chain scale occupancy levels, also something we detail later, 2) its international unit pipeline growth, and 3) the de-leveraging and therefore differentiated aspect of the story, to be most appealing,” the report noted. Some risks from the report include elevated leverage relative to peers should macro issues emerge, the potential for share pressure as Blackstone sells down its ownership stake, the potential for disruptions to the international pipeline and generic macroeconomic or event risks. HLT closed Friday at $21.95 with shares trading down at 1.36 percent.