NEW YORK (TheStreet) -- Hilton Worldwide Holdings (HLT) - Get Hilton Worldwide Holdings Inc (HLT) Report stock is up 0.87% to $26.70 in market trading on Wednesday after Deutsche Bank maintained their "buy" rating and $31 price target following a management meeting the company's CEO had at the Americas Lodging Investment Summit.
Deutsche Bank views Hilton's relative valuation, visible and growing franchise pipeline, accelerating free cash profile and strong trading liquidity as key reasons to buy the stock.
Hilton is focused on pursuing essentially all of 2014's goals, including enhancing the value/reach of its brands via strategic initiatives and entry into new markets, continuing an intense focus on maximizing operating leverage at its owned hotels, and using free cash flow to de-leverage the balance sheet, Deutsche Bank analysts said.
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Hilton is a hospitality company that operates 4,080 hotels, resorts and timeshare properties.
Separately, TheStreet Ratings team rates HILTON WORLDWIDE HOLDINGS as a Hold with a ratings score of C-. TheStreet Ratings Team has this to say about their recommendation:
"We rate HILTON WORLDWIDE HOLDINGS (HLT) a HOLD. The primary factors that have impacted our rating are mixed some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk, unimpressive growth in net income and poor profit margins."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 8.7%. Since the same quarter one year prior, revenues slightly increased by 8.0%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period, despite the company's weak earnings results.
- In comparison to the other companies in the Hotels, Restaurants & Leisure industry and the overall market, HILTON WORLDWIDE HOLDINGS's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- The change in net income from the same quarter one year ago has exceeded that of the Hotels, Restaurants & Leisure industry average, but is less than that of the S&P 500. The net income has decreased by 8.5% when compared to the same quarter one year ago, dropping from $200.00 million to $183.00 million.
- Although HLT's debt-to-equity ratio of 2.52 is very high, it is currently less than that of the industry average. Along with the unfavorable debt-to-equity ratio, HLT maintains a poor quick ratio of 0.85, which illustrates the inability to avoid short-term cash problems.
- You can view the full analysis from the report here: HLT Ratings Report