) to strong buy from buy.
Analyst Stephanie Krewson says her upgrade coincides with her more constructive view on lodging fundamentals. She says industry-wide revenue per available room (RevPar) was up 2% between July and September, reflecting strong leisure travel, a pickup in transient business travel, and firmer room rates. Provided that the U.S. economy continues to exhibit signs of expansion, Krewson expects positive trends to continue, and believes Equity Inns should benefit from a broader recovery.
Krewson tweaked the 92 cents 2003 earnings per share estimate to 93 cents, and upped the $1.01 2004 estimate to $1.02. She also raised her $8 12-month target to $10.50, implying a potential total return of 32%.