Why Sunstone Hotel Investors (SHO) Stock Is Down After-Hours Thursday

NEW YORK (TheStreet) -- Sunstone Hotel Investors (SHO) was falling -1.8% to $14.60 after-hours Thursday after announcing it will buy a Maui resort and that it will issue more stock in a public offering.

Sunstone Hotel Investors will purchase to Wallea Beach Marriot Resort and Spa for $325.7 million. The hotel and spa holds 544 rooms, and sits on 22 acres on the Hawaiian island.

The company also announced it will issue 18 million shares of common stock in a public offering. Sunstone Hotel Investors will use the proceeds from the offering to pay for a portion of the resort acquisition. The proceeds will also be used for other potential future acquisitions and general corporate purposes.

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TheStreet Ratings team rates SUNSTONE HOTEL INVESTORS INC as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:

"We rate SUNSTONE HOTEL INVESTORS INC (SHO) 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 robust revenue growth, solid stock price performance and impressive record of earnings per share growth. However, as a counter to these strengths, we also find weaknesses including deteriorating net income and poor profit margins."

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