UPDATE: Deutsche Bank Raises PT on Marriott Vacations Worldwide on Modest Organic Growth Prospects
In a report published Wednesday, Deutsche Bank analyst Greg Poole reiterated a Hold rating on Marriott Vacations Worldwide Corp. (NYSE: VAC), and raised the price target from $50.00 to $51.00.
In the report, Deutsche Bank noted, “While VAC did increase the low end of FY14 free cash flow guidance and continued repurchasing stock in 1Q14 (0.7m shares for $37m), we note that tour flow growth was negative and development margins were boosted in part by increased unit repurchase activity (at lower than development cost). VAC is undertaking initiatives aimed at bolstering the mix of new buyers, but we believe this may come at the expense of incremental profitability; new buyers are key to expanding the base of finance and ancillary fee generation. We are increasing our price target to $51 (+$1) on slightly higher out-year EBITDA and balance sheet adjustments, but our rating remains Hold.”
Marriott Vacations Worldwide Corp. closed on Tuesday at $54.41.
© 2014 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.