FBR Upgrades Hyatt Hotels On Share Pullback
FBR analyst Nikhil Bhalla upgraded Hyatt Hotels Corporation (NYSE: H) from Market Perform to Outperform and raised the price target raised from $55 to $62. Shares of Hyatt Hotels are trading up $1.19 or 2.29 percent to $53.25 per share.
FBR stated this regarding its price target, “while we agree that the stock should trade at a discount to MAR and HOT given the super majority voting structure, lower liquidity in the stock, and no dividend, the over 6% pullback in the shares recently makes for a good entry point.”
FBR also stated that, in its view shareholders of Hyatt International should expect to see share buybacks over the next couple of years. Hyatt expects to generate approximately 1.2 billion of free cash flow between 2014 and 2016, representing a 13 percent FCF yield based on the current share price.
To end the report FBR stated, “while the company may under/over shoot our, and consensus, forward quarterly expectations given that it does not provide guidance, we believe H shares are suited for investors with a longer-term horizon based on our aforementioned reasons.”
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