UPDATE: Credit Suisse Initiates Diamond Resorts International at Outperform on Multiple Positive Factors

In a report published Tuesday, Credit Suisse analyst J. Simkins initiated coverage on Diamond Resorts International DRII with an Outperform rating and $21.00 price target.

In the report, Credit Suisse noted, “DRII is poised to benefit from the recovery of the timeshare industry, where industry volumes remain 35% below peak. HAMS (Hospitality and Management Services - Diamond's HOA management business) should generate predictable growth as the company expands its platform and pushes through dues increases, while we expect the VOI segment (Vacation Ownership Interest sales and financing) to achieve a more significant ramp through improved tour flow, higher pricing, and gains in efficiency. We anticipate DRII should benefit from embedded growth opportunities within its core businesses as well as efforts to reduce leverage and improve its cost of capital. Diamond has a demonstrated acquisition track record and looks to be a platform for bolt-on deals.”

Diamond Resorts International closed on Monday at $16.43.