) to hold from sell.
Analyst David Richter says he's upgrading on valuation and the company's moderate leverage to an eventual lodging industry recovery. He notes the stock has been weak, falling 30% since mid-September. As for an industry recovery, he says the third-quarter earnings per share announcements by a majority of hotel operators indicates a recovery could gain momentum by early 2004.
Richter is keeping his 42 cents 2003 earnings per share and 52 cents 2004 earnings per share estimates; he has a $13 target. He notes the 2004 earnings per share estimate assumes proceeds from the company's July 2003 convertible senior note offering are held in cash, which he estimates is 8 cents dilutive to full-year cash earnings per share.