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Quality Hotel Chain At A Reasonable Price...In China: Deutsche Bank Advises Investors To Buy The US Traded Stock
67 WALL STREET, New York - November 24, 2009 - The Wall Street Transcript has just published its Travel and Leisure Report --Airlines, Hotels, Resorts, Cruise Lines, and Restaurants offering a timely review of the sector to serious investors and industry executives. This 137 page feature contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. The full issue is available via The Wall Street Transcript Online.
Topics covered: Consumer Traveler Spending - U-Shaped Recovery in Restaurant Sector - Low-Cost and Network Airlines - Airline Carriers and Online Travel Agencies - Hotel Occupancy Rates - Improvement in Transportation Sector - Upscale Casual and Fast Casual Restaurants - Near-Term Risk in Hotel Space - Fuel Prices a Universal Concern - Restaurant Industry Stability - Increased Consolidation in Airline Industry - Firming of Traffic Trends in Restaurant Space
Companies include: Vail Resorts, Inc. (MTN); Air France-KLM (AFLYY); AirTrans (AAI); Alaska Air Group (ALK); Allegiant Travel Group (ALGT); American Airlines (AMR); Applebee's (APPB); Ashford (AHT); BJ's Restaurants (BJRI); Boeing (BA); Brinker (EAT); British Airways (BAY); Buffalo Wild Wings (BWLD); Burger King Corp (BKC); California Pizza Kitchen (CPKI); Carnival (CCL); Cheesecake Factories (CAKE); Chipotle Mexican Grill (CMG); Choice (CHH); Continental Airlines (CAL); Darden (DRI); Delta Airlines (DAL); Denny's (DENN); DiamondRock (DRH); Domino's Pizza (DPZ); Expedia (EXPE); Famous Dave's (DAVE); FelCor (FCH); Gaylord Entertainment (GET); Great Wolf Resorts (WOLF); Green Mountain (GMCR); Hawaiian Holdings (HA); Home Inns & Hotels (HMIN); Hospitality Properties Trust (HPT); JetBlue Airlines (JBLU); LaSalle Hotel Properties (LHO); Lufthansa (LHA); MHI Hospitality Corporation (MDH); Marriott (MAR); McDonalds (MCD); Mesa (MESA); Morton's Steakhouse (MRT); National Business Travel Association (NBTA); National Mediation Board (NMB); Orbitz (OWW); P.F. Chang's (PFCB); Panera Bread (PNRA); Peet's (PEET); Priceline (PCLN); Republic Airlines (RJET); Royal Caribbean Cruise Lines (RCL); Royal Caribbean International (HST); Ruby Tuesday (RT); Ruth's Chris Steakhouse (RUTH); Sonesta (SNSTA); Sonic (SONC); Southwest Airlines (LUV); Spicy Pickle (SPKL.OB); Starbucks (SBUX); Starwood Hotels (HOT); Strategic (BEE); Sunstone (SHO); Texas Roadhouse (TXRH); UFood (UFFC.OB); US Air (LCC); United Airlines (UAUA); Wyndham (WYN)
In the following brief excerpt from just one of the 25 in depth interviews in the 137 page Special Report, an award winning equity analyst discusses the outlook for the Hotel sector for investors.
Chris Woronka, Vice President, Equity Research, is the lead lodging and hotel REIT Analyst for Deutsche Bank. He has approximately eight years of sell-side research experience in the gaming, lodging, leisure and REIT sectors, including affiliations with teams previously ranked by Institutional Investor and The Wall Street Journal's annual "Best on the Street" survey. He is currently ranked as a five-star analyst by StarMine for earnings estimate accuracy and as a four-star analyst by StarMine for recommendations performance.
His research has been quoted in numerous media outlets, including The Wall Street Journal, Time, Reuters, Bloomberg, MarketWatch, SmartMoney, The Washington Post and The New York Times. He has been featured on CNBC's "Closing Bell" program and has also participated on Information Management Network and New York University Hospitality Conference panels.
Prior to joining Deutsche Bank in 2004, Mr. Woronka held equity research positions at CIBC World Markets and BB&T Capital Markets. He holds an MBA in finance and a B.S. in accounting from the R.B. Pamplin College of Business at Virginia Tech. He is based at Deutsche Bank's New York headquarters.
TWST: What names in this space do you like the most right now and why?
Mr. Woronka: I have "buy" ratings on Gaylord Entertainment (GET) and also Home Inns & Hotels (HMIN), which is a Chinese company but it's listed here in the U.S. Outside of Gaylord, among the U.S. stocks I do have "hold" ratings. I'm neutral on those stocks. Again, my overriding thesis is that the stocks have baked in a healthy level of recovery already. And while I expect that to happen, I think there is a greater risk that it pans out that it is not as robust as what some investors may be expecting. Within the "hold" ratings, I can say that something like a Choice Hotels (CHH) is a company that is trading at a discount to the rest of the stocks. I think they are at a pretty good competitive spot in terms of where they compete. They are in that mid-scale sector, and they are a franchisor, so they are not exposed to operating leverage. Right now everyone wants operating leverage because you're thinking about recovery, but I think there will be some challenges to flow-through on the owner operators like the REITS and a couple of the real estate operating companies. So Choice is an interesting one on a relative basis. Wyndham (WYN) is interesting. It's not technically really a hotel company. A third of its business comes from hotel franchising. The other two-thirds come from different businesses - leisure businesses but not really hotel businesses. I would say, to a third extent, Vail Resorts (MTN), again not strictly a lodging company, could be interesting. The stock has been weak of late. Again on a relative basis, the valuation is at a discount to the peers. So I have "hold" ratings on all three of those, but I would say if you wanted to be bullish, you could probably make more of a case there on valuation. It's very difficult for me to make most of the other stocks work on valuation.
CHRIS WORONKA
Vice President, Equity Research
Deutsche Bank
The Wall Street Transcript is a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs and research analysts. This 37 page special issue is available via The Wall Street Transcript Online .
The Wall Street Transcript does not endorse the views of any interviewees nor does it make stock recommendations.
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