NEW YORK (TheStreet) -- Shares of Hyatt Hotels Corp (H) were gaining, up 1.56% to $57.22 in early market trading Thursday, after analysts at Brean Capital initiated coverage with a "buy" rating this morning.
The firm issued a $68 price target, saying there are meaningful growth opportunities ahead, despite the company's relative small size.
Brean analysts praised "the company's relentless pursuit of industry-leading customer service and brand quality."
The firm says the company is well recognized due to the strategic location of its hotels in resort and gateway markets.
"Over the past several years Hyatt has created several new lodging brands, all of which it will seek to leverage its existing infrastructure and management talent to grow materially over the next decade," the firm wrote in a note.
Chicago, Ill.-based Hyatt Hotels is a hospitality company that develops, owns, operates, manages, franchises, licenses or provides services to a portfolio of properties, consisting of full service hotels, select service hotels, resorts and other properties.
The company's portfolio consists of about 587 properties with 155,265 rooms and units.
It operates hotels and resorts under five brands, including Park Hyatt, Andaz, Hyatt, Grand Hyatt and Hyatt Regency.
Separately, TheStreet Ratings team rates HYATT HOTELS CORP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate HYATT HOTELS CORP (H) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels and notable return on equity. We feel its strengths outweigh the fact that the company has had sub par growth in net income."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- 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. To add to this, H has a quick ratio of 1.93, which demonstrates the ability of the company to cover short-term liquidity needs.
- Regardless of the drop in revenue, the company managed to outperform against the industry average of 7.4%. Since the same quarter one year prior, revenues slightly dropped by 1.9%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. In comparison to the other companies in the Hotels, Restaurants & Leisure industry and the overall market, HYATT HOTELS CORP's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- HYATT HOTELS CORP has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, HYATT HOTELS CORP increased its bottom line by earning $2.25 versus $1.30 in the prior year. For the next year, the market is expecting a contraction of 48.0% in earnings ($1.17 versus $2.25).
- You can view the full analysis from the report here: H Ratings Report