Jefferies Raises Price Target on Starwood Hotels & Resorts (HOT) on Solid Outlook and Results

Jefferies is reaffirming its Hold rating on shares of Starwood Hotels & Resorts (NYSE: HOT) while increasing its price target from $42 to $48.

The company reported strong third quarter results with earnings of $0.42 per share on an adjusted basis, topping the firm and Street's estimates of $0.34 and $0.39. The firm notes the upside was largely driven by favorable currency rates. Worldwide company-owned same-store branded RevPAR rose 16.2 percent.

Management increased its vacation ownership operating income guidance for 2011 from $130-$140 million to $140-$145 million. They also narrowed their EBITDA guidance from $0.975-$1 billion to $980-$990 million.

For 2012, managements guidance has a RevPar range of 4-8 percent, which Jefferies notes highlights "a large amount of uncertainty and low visibility."

For 2011 and 2012, Jefferies is raising its EPS estimates from $1.67 and $1.87 to $1.75 and $1.98.

For more ratings news on Starwood Hotels & Resorts click here and for the rating history of Starwood Hotels & Resorts click here.

Shares of Starwood Hotels & Resorts closed at $52.60 yesterday.

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