Citadel Securities Lowers Estimates on Diamondrock Hospitality (DRH); Strong Acquisition Spending, Unimpressive 2Q11 Earnings, Skeptical on Outlook
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Price: $12.82 +0.39%
Rating Summary:
11 Buy, 15 Hold, 2 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
11 Buy, 15 Hold, 2 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Citadel Securities maintains a 'Neutral' on Diamondrock Hospitality (NYSE: DRH) price target of $11.00.
Citadel analyst says, "DRH is currently trading at 15.9x and 13.1x, respectively, our EBITDA ests for 2011 and 2012. Quite simply, we believe that the onus is on DiamondRock to justify its recent hotel purchases; this can only be accomplished when we begin to see meaningful (and accretive) contributions from these hotels. Until then, there is little that excites us about DRH shares in the $10-11 range. We still value DRH at 12.5x LTM EBITDA (now at 3Q12) and replacement cost of $300k/key, with a 70/30 split between the two methodologies."
"In 2012 and 2013 our estimates have come down slightly, with 2012 FFO and EBITDA expected to be $0.88/sh (from $0.90) and $207MM (from $208MM). In 2013, we now forecast FFO of $1.01/sh (from $1.04) and EBITDA of $227MM (from $230MM)."
For more ratings news on Diamondrock Hospitality click here and for the rating history of Diamondrock Hospitality click here.
Shares of Diamondrock Hospitality closed at $10.23 yesterday.
Citadel analyst says, "DRH is currently trading at 15.9x and 13.1x, respectively, our EBITDA ests for 2011 and 2012. Quite simply, we believe that the onus is on DiamondRock to justify its recent hotel purchases; this can only be accomplished when we begin to see meaningful (and accretive) contributions from these hotels. Until then, there is little that excites us about DRH shares in the $10-11 range. We still value DRH at 12.5x LTM EBITDA (now at 3Q12) and replacement cost of $300k/key, with a 70/30 split between the two methodologies."
"In 2012 and 2013 our estimates have come down slightly, with 2012 FFO and EBITDA expected to be $0.88/sh (from $0.90) and $207MM (from $208MM). In 2013, we now forecast FFO of $1.01/sh (from $1.04) and EBITDA of $227MM (from $230MM)."
For more ratings news on Diamondrock Hospitality click here and for the rating history of Diamondrock Hospitality click here.
Shares of Diamondrock Hospitality closed at $10.23 yesterday.
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