Janney Raises Price Target on Starwood Hotels; Maintains "Buy" Rating; Lowers Guidance (HOT)

Janney Raises Price Target on Starwood Hotels; Maintains “Buy” Rating; Lowers Guidance (HOT)


On Monday, analysts at Janney Montgomery Scott boosted the price target on Starwood Hotels & Resorts Worldwide, Inc (HOT) after its fourth-quarter earnings report on Thursday and a positive view of its lodging outlook in 2013.

The analysts maintain a “Buy” rating on HOT and see shares reaching $68, up from the previous target of $67. This new valuation suggests about an 8% upside to Friday’s closing price of $62.81.

The analysts cite an improved lodging outlook in 2013 that should benefit Starwood Hotels. The company is planning on adding 30 more properties in the year as well. As a result, supply and demand volatility should calm down in the short term leading to easier comps.

Furthermore, the company bought back 3.5 million shares in the fourth quarter and should continue to buyback $180 million worth of shares in 2013.

Despite these positive views, Janney decreased its FY2013 EPS estimate for HOT from $2.83 to $2.68.

Starwood Hotels shares were inactive during pre-market trading on Monday. The stock is up about +13% over the past year.

The Bottom Line
Shares of Starwood Hotels (HOT) have a dividend yield of 1.99% based on Friday’s closing price of $62.81 and the company’s annualized dividend payout of $1.25.

Starwood Hotels & Resorts Worldwide, Inc (HOT) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.

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