UPDATE: Bank of America Upgrades Strategic Hotels and Resorts on Highest Quality Portfolio


27% profits every 20 days?

This is what Nic Chahine averages with his options buys. Not selling covered calls or spreads... BUYING options. Most traders don't even have a winning percentage of 27% buying options. He has an 83% win rate. Here's how he does it.


In a report published Monday, Bank of America Merrill Lynch analyst Andrew Didora upgraded Strategic Hotels and Resorts, Inc. (NYSE: BEE) to Buy from Underperform, raising its price objective to $11.50 from $8.00. According to the report, it is believed that BEE has the highest quality portfolio in the public hotel REIT sector with the greatest exposure to both luxury hotels and high barrier to entry markets. Despite the significant stock price outperformance in 2013, we believe upside remains as BEE monetizes additional assets and benefits from its luxury footprint. Luxury hotel transactions are accelerating with pricing nearly twice BEE's value, and luxury RevPAR outperforms later in the cycle as business spend increases. “40% of BEE's are Four Seasons, Ritz Carlton or Fairmont with nearly all of them in key gateway urban and resort markets that have minimal supply growth,” the report noted. “Luxury RevPAR outperformed the industry by 400bps in the later stages of the prior cycle, and we expect a similar trend could play out this time as businesses increase spending at a time when luxury supply (flat to up modestly) is well below the industry (+1.1%). As a result, we are raising our 2014 RevPAR forecast to +6% from +5%, a 100bps premium to our industry outlook, but we are lowering our EBITDA estimates to account for the Punta Mita sale.”BEE closed Friday at $9.34.

27% profits every 20 days?

This is what Nic Chahine averages with his options buys. Not selling covered calls or spreads... BUYING options. Most traders don't even have a winning percentage of 27% buying options. He has an 83% win rate. Here's how he does it.


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Posted In: Analyst ColorUpgradesAnalyst RatingsAndrew DidoraBank of America Merrill Lynch