November 19, 2012 at 08:30 AM EST
Jefferies Starts Starwood Hotels Off With a “Buy” Rating (HOT)

Analysts at Jefferies initiated coverage on hotel operator Starwood Hotels & Resorts Worldwide, Inc (HOT) on Monday with a “Buy” rating.

The analysts set a price target for the company at $59. The valuation is a +14.5% upside to Friday’s closing price of $51.52.

Jefferies commented, “We find a lot to like about Starwood. An asset-light operator, the company has a strong domestic heritage, but the business is evolving towards faster-growing Emerging Markets. Starwood comes top on our qualitative Jefferies Scorecard. The company stands on 10.3x FY13E EV/EBITDA, an 8% discount to Marriott (NYSE: MAR), despite its more positive attributes. Our price target offers 17% upside potential.”

Starwood shares were flat in premarket trading on Monday. The stock is up $3.55, or +7.4%, year-to-date.

The Bottom Line
Shares of Starwood Hotels (HOT) have a 2.43% dividend yield, based on Friday’s closing stock price of $51.52. The stock has technical support in the $46-$48 price area. If the shares can firm up, we see overhead resistance around the $54-$56 price levels.

Starwood Hotels & Resorts Worldwide, Inc (HOT) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.3 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.

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