Will Hyatt Hotels (H) Stock Be Negatively Impacted By This Ratings Downgrade?

NEW YORK (TheStreet) -- Hyatt Hotels Corp. (H) was downgraded to "underperform" from "neutral" at Credit Suisse (CS) on Friday.

The firm said it lowered its rating on the hospitality company based on a valuation call.

Credit Suisse cut its price target on Hyatt Hotels to $55 from $56.

Must Read: Warren Buffett's 25 Favorite Stocks


Separately, TheStreet Ratings team rates HYATT HOTELS CORP as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:

"We rate HYATT HOTELS CORP (H) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, reasonable valuation levels and good cash flow from operations. We feel these strengths outweigh the fact that the company shows low profit margins."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 6.5%. Since the same quarter one year prior, revenues rose by 10.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The current debt-to-equity ratio, 0.31, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.42, which illustrates the ability to avoid short-term cash problems.
  • Powered by its strong earnings growth of 620.00% and other important driving factors, this stock has surged by 49.98% over the past year, outperforming the rise in the S&P 500 Index during the same period. Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains in the past year.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Hotels, Restaurants & Leisure industry. The net income increased by 600.0% when compared to the same quarter one year prior, rising from $8.00 million to $56.00 million.
  • You can view the full analysis from the report here: H Ratings Report
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