Skip to main content

Market Overview

Time To Sell Lodging Stocks? Morgan Stanley Downgrades En Masse


Morgan Stanley’s Thomas Allen downgraded the rating on the Lodging Industry to In-Line, mentioning that the stocks had gained 16 percent in the last 30 days.

While historical mid-cycle multiples have been in the 11-12x range and lodging companies are better run now, in terms of higher ROIC and SS margins, than they were in previous cycles, concerns surrounding another recession in the near term suggest that mid-cycle multiples are no longer appropriate, analyst Thomas Allen commented.

Hyatt Hotels And Xenia Hotels

Morgan Stanley downgraded the ratings for Hyatt Hotels Corporation (NYSE: H) and Xenia Hotels & Resorts Inc (NYSE: XHR) to Equal-weight, while maintaining the price targets at $48 and $17, respectively.

Allen sees a more balanced risk/reward, since the stocks of the two companies have appreciated 20 percent and 12 percent, respectively, in the last one month. While Hyatt Hotels continues to have an attractive balance sheet and Xenia Hotels has significant underappreciated assets, these catalysts will take a long time to play out.

Starwood Hotels

Allen downgraded the rating for Starwood Hotels & Resorts Worldwide Inc (NYSE: HOT) to Equal-weight, while raising the price target from $72 to $77, to reflect the mid-point of two takeout offers received by the company.

Starwood Hotels’ shares had reached within 5 percent of the recent Anbang takeout offer of $80 including Vistana. The offer price of $80 is higher than the implied $73 accepted offer from Marriott International Inc (NASDAQ: MAR), Allen stated.

La Quinta Holdings

Morgan Stanley downgraded the rating for La Quinta Holdings Inc (NYSE: LQ) to Equal-Weight, while reducing the price target from $13 to $12.

The analyst mentioned that the company’s high exposure to the oil market is a major headwind, since oil prices are expected to decline this year. The 2016 EBITDA estimate has been reduced from $369 million to $364 million.

Latest Ratings for H

Feb 2021Evercore ISI GroupMaintainsIn-Line
Feb 2021BerenbergDowngradesHoldSell
Jan 2021Morgan StanleyMaintainsEqual-Weight

View More Analyst Ratings for H
View the Latest Analyst Ratings


Related Articles (H + XHR)

View Comments and Join the Discussion!

Posted-In: Morgan Stanley Thomas AllenAnalyst Color Downgrades Price Target Analyst Ratings

Latest Ratings

OSPNSidoti & Co.Upgrades39.0
PLTSidoti & Co.Upgrades48.0
LRCXArgus ResearchMaintains725.0
ROSTLoop CapitalMaintains145.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Everything you need to know about the latest SPAC news.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at