UPDATE: Bank of America Reiterates Buy Rating, Raises PT on Ashford Hospitality Trust Following Announcement of Asset Management Business Spin-Off

In a report published Monday, Bank of America analyst Andrew G. Didora reiterated a Buy rating on

, and raised the price target from $10.50 to $12.50. In the report, Bank of America noted, “Following AHT's announcement that its Board of Directors has approved a plan to spin-off its asset management business into a new publicly traded entity, we are maintaining our Buy rating and raising our price objective to $12.50 from $10.50 (on a slightly higher multiple). While the spin-off will be small out of the box and not completed until late in 2014, we think AHT remains a levered way to play positive fundamentals in the hotel sector. Further, at 12.7x 2014E EBITDA, AHT is over a turn lower than the peer average and is, in our view, the cheapest hotel company across our entire coverage universe while paying a 5% yield.” Ashford Hospitality Trust closed on Friday at $11.18.