Barclays on U.S. Lodging: 3Q11 Earnings Preview of HST, DRH, CHH & HOT
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Up: 12 | Down: 15 | New: 40
Rating Summary:
17 Buy, 18 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 12 | Down: 15 | New: 40
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Barclays on U.S. Lodging: 3Q11 Earnings Preview
Barclays analyst, Felicia R. Hendrix, said, "We expect 3Q11 results from the companies in our lodging coverage universe to largely mirror those released by Marriott last week - solid quarterly results and a cautiously optimistic view for 2012 (though Starwood is the only other company that should give formal 2012 guidance). While global economic headlines have been a headwind on the stocks and investor psychology, lodging fundamentals have remained stable as evidenced by weekly industry data and underscored by Marriott's commentary last week. Despite this phenomenon, we expect limited upside to lodging valuations until there is more clarity regarding the global economy and more
confidence in consensus expectations."
"Host (NYSE: HST) reports on 10/12. As a reminder, the company does not provide quarterly guidance. We forecast EBITDA and FFO per share of $222mn and $0.15 (vs Consensus of $208mn and $0.17) based on RevPAR growth of 7.4%. We expect the company to report in-line with our estimates and maintain 2011 guidance. We also expect HST to provide some color on 2012 trends."
"Diamondrock Hospitality (NYSE: DRH) should report results on 10/19. We forecast EBITDA and FFO/share of $45mn and $0.17 (vs Consensus of $42mn and $0.16), based on 7% RevPAR growth. The company should report in-line with our RevPAR estimate as most of its target markets were strong, though weaker Group demand in the quarter could somewhat offset this, similar to last quarter. DRH does not provide quarterly guidance and we expect the company to maintain 2011 guidance. We do not expect the company to offer 2012 guidance at this time."
"Choice (NYSE: CHH) will report on 10/26. We forecast EBITDA and EPS of $59mn and $0.59 (vs. Consensus of $60mn and $0.60). Our estimate is based on RevPAR growth of 5%, reflecting company guidance. We expect Choice to report in-line with our estimate and guidance and also maintain 2011 guidance."
"Starwood (NYSE: HOT) will report on 10/27. We forecast EBITDA and EPS of $233mn and $0.39 (vs guidance of $225mn to $235mn and $0.36 to $0.40 respectively). Consensus EBITDA is $234mn and EPS is $0.39. We forecast W.W. local currency RevPAR growth of 9% (vs guidance of +7% to +9%). We expect HOT to report in-line with our estimates and at high end of RevPAR guidance. The company should maintain implied 4Q guidance and will likely introduce guidance for 2012 W.W. RevPAR to increase in the mid single digits."
Barclays analyst, Felicia R. Hendrix, said, "We expect 3Q11 results from the companies in our lodging coverage universe to largely mirror those released by Marriott last week - solid quarterly results and a cautiously optimistic view for 2012 (though Starwood is the only other company that should give formal 2012 guidance). While global economic headlines have been a headwind on the stocks and investor psychology, lodging fundamentals have remained stable as evidenced by weekly industry data and underscored by Marriott's commentary last week. Despite this phenomenon, we expect limited upside to lodging valuations until there is more clarity regarding the global economy and more
confidence in consensus expectations."
"Host (NYSE: HST) reports on 10/12. As a reminder, the company does not provide quarterly guidance. We forecast EBITDA and FFO per share of $222mn and $0.15 (vs Consensus of $208mn and $0.17) based on RevPAR growth of 7.4%. We expect the company to report in-line with our estimates and maintain 2011 guidance. We also expect HST to provide some color on 2012 trends."
"Diamondrock Hospitality (NYSE: DRH) should report results on 10/19. We forecast EBITDA and FFO/share of $45mn and $0.17 (vs Consensus of $42mn and $0.16), based on 7% RevPAR growth. The company should report in-line with our RevPAR estimate as most of its target markets were strong, though weaker Group demand in the quarter could somewhat offset this, similar to last quarter. DRH does not provide quarterly guidance and we expect the company to maintain 2011 guidance. We do not expect the company to offer 2012 guidance at this time."
"Choice (NYSE: CHH) will report on 10/26. We forecast EBITDA and EPS of $59mn and $0.59 (vs. Consensus of $60mn and $0.60). Our estimate is based on RevPAR growth of 5%, reflecting company guidance. We expect Choice to report in-line with our estimate and guidance and also maintain 2011 guidance."
"Starwood (NYSE: HOT) will report on 10/27. We forecast EBITDA and EPS of $233mn and $0.39 (vs guidance of $225mn to $235mn and $0.36 to $0.40 respectively). Consensus EBITDA is $234mn and EPS is $0.39. We forecast W.W. local currency RevPAR growth of 9% (vs guidance of +7% to +9%). We expect HOT to report in-line with our estimates and at high end of RevPAR guidance. The company should maintain implied 4Q guidance and will likely introduce guidance for 2012 W.W. RevPAR to increase in the mid single digits."
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