We have recently downgraded our rating on the shares of Starwood Hotels & Resorts Worldwide Inc. (HOT) to Neutral from Outperform due to a slowdown in 2012 RevPAR growth target in North America, weak EBITDA projection as well as weakness in certain international markets. We were impressed with Starwood’s outperformance in the recently concluded fourth quarter of 2011. The strength of the namesake brand allows the company to charge a premium for its hotel rooms. Moreover, the company is in a steady expansion mode. Starwood has over half of its hotel properties outside the U.S., an international exposure that not many of its peers can boast of. Starwood will open 80 new hotels in 2012, with 75% of them being outside North America, primarily in the faster growing Asia (60.0%).
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