MLV & Co Reiterates Buy, Lowers Price Target On Strategic Hotels And Resorts Following 4Q Review

In a report published Wednesday, MLV & Co analyst Ryan Meliker reiterated a Buy rating on Strategic Hotels and Resorts Inc. (NYSE: BEE), but lowered the price target from $16.00 to $15.00.

In the report, MLV & Co noted, "BEE's 4Q print was relatively disappointing as EBITDA and FFO came in light. Guidance may have been light as well when factoring in the impact from recently announced acquisitions. The company is currently seeing a fundamental slowdown and some pressure to group pacing, which we believe was the primary driver behind conservative initial 2015 guidance. With that being said, we believe expectations have been officially reset by this earnings release, with BEE sitting in a strong financial position at the point in the cycle where luxury properties should thrive. Additionally, while the stock may look expensive on EBITDA (16.5x 2015E) or FFO (15.8x 2015E) multiples, we believe shares trade in-line with NAV. As cash flows grow, so will NAV, which we believe creates upside to the stock. We reiterate our BUY rating, but lower our YE 2015 PT by $1, to $15, given initial 2015 guidance."

Strategic Hotels and Resorts closed on Tuesday at $12.99.