UPDATE: Morgan Stanley Upgrades Sunstone Hotel Investors (SHO) to Overweight

January 18, 2022 3:39 AM EST
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Price: $11.18 -3.12%

Rating Summary:
    8 Buy, 9 Hold, 4 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 4 | Down: 15 | New: 18
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(Updated - January 18, 2022 4:54 AM EST)

Morgan Stanley analyst Thomas Allen upgraded Sunstone Hotel Investors (NYSE: SHO) from Equalweight to Overweight with a price target of $14.00 (from $13.00).

The analyst comments "SHO was the worst performing stock in our Lodging coverage in 2021, up 4% vs. peer avg 28%. We think its current multiple does not reflect the true value of its portfolio. SHO owns a small portfolio of "long-term relevant real estate." Given that unique, irreplaceable assets are trading at record prices and US private equity has amassed an unprecedented amount of dry powder for real estate transactions, we see potential for this value to be unlocked. We value the stock at 13.5x 2023e EBITDA, only a slight premium to where we value peers despite its higher asset value, which implies 16% upside. Valuing SHO on a price per key basis implies 37% upside."

For an analyst ratings summary and ratings history on Sunstone Hotel Investors click here. For more ratings news on Sunstone Hotel Investors click here.

Shares of Sunstone Hotel Investors closed at $11.82 yesterday.


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