Wachovia analyst Jeffrey Donnelly downgraded his ratings for Strategic Hotels & Resorts Inc. and Ashford Hospitality Trust Inc. to “Underperform” and lowered his ratings on Host Hotels & Resorts Inc., FelCor Lodging Trust Inc. and Diamondrock Hospitality Co. to “Market Perform.” A Wachovia Capital Markets analyst cut his ratings for five lodging companies on Thursday, predicting that revenue per available room will drop 3 percent in 2009 across the top 25 markets. Revenue per available room, or revpar, is considered a key gauge of a hospitality company’s performance.

Donnelly reduced his earnings estimates for each of the 14 lodging companies he covers, including Marriott International Inc. and Choice Hotels International Inc., to reflect slower revpar growth and margin contraction. Based on his adjusted forecast, Donnelly estimated that Strategic and Ashford will not be able to pay their current dividend from operating cash flow in 2009 and may be forced to cut their payouts by as much as 60 percent.

This entry was posted on Friday, July 18th, 2008 at 7:04 pm and is filed under Condo, Hotel. Tags: Analyst Recommendation Ashford Hospitality Trust Inc. Choice Hotels International Inc. DiamondRock Hospitality Co. FelCor Lodging Trust Inc. Jeffrey Donnelly Marriott International Inc. Wachovia . You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.