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Deutsche Bank Previews Lodging Industry; Notes Sentiment Is Muted

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Carlo Santarelli of Deutsche Bank previewed the Lodging industry ahead of the major companies reporting third quarter results. The analyst favors the group, especially U.S.-centric names despite Ebola and U.S. economic growth and consumer spending concerns.

“Given how the quarter played out (sequential strengthening into September) and the likelihood that share repurchase activity remained robust, we have every reason to believe that most companies will meet or exceed our estimates and consensus," Santarelli wrote. The analyst adds that Lodging operators should be able to issue guidance that is consistent with consensus estimates, adding further confidence to the group's prospects.

Santarelli is brushing aside Ebola and U.S. and Europe growth rates and notes that consensus estimates on the group has not moved higher despite RevPAR (revenue per average room) accelerated between July and September. The analyst believes that sentiment is “muted” and offers investors a “favorable setup.”

Santarelli's “favored ideas” for investors consists of Hyatt Hotels (NYSE: H), Starwood Hotels & Resorts Worldwide (NYSE: HOT), Ryman Hospitality Properties (NYSE: RHP) and Summit Hotel Properties (NYSE: INN).

Posted-In: Carlo Santarelli Ebola Hyatt Hotels Lodging Ryman Hospitality Starwood Hotels Summit HotelNews


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