Analyst cuts rating on Marriott after steep run-up
NEW YORK (AP) — A JPMorgan analyst cut his rating on shares of Marriott International Inc. to "Neutral" from "Overweight" on Thursday, saying a steep run-up in the stock may be over for now.
Joseph Greff said in a note to clients that while he's still optimistic about the long-term prospects of the hotel industry, he recommends investors tread lightly with Marriott because its shares have risen so high. The stock is up 42 percent so far this year, farther than its peers and nearly three times the rate of the Standard & Poor's 500 index.
The analyst credits the stock's performance to its timeshare business spinoff, share buybacks and dividend and its ability to grow earnings bu more than 20 percent per year.
But at this point, Greff doesn't think the stock has much more room to grow. He believes the company will continue to grow next year, but at a slower pace.
Greff recommends investors choose Starwood Hotels & Resorts Worldwide Inc. instead.
Marriott shares fell 12 cents to $40.78 in afternoon trading. The stock hit a 52-week high of $41.84 last week.