Choice Hotels International (CHH) Cut to Hold at Zacks Investment Research

Zacks Investment Research cut shares of Choice Hotels International (NYSE:CHH) from a buy rating to a hold rating in a research note issued to investors on Thursday morning.

According to Zacks, “Choice Hotels’ shares have outperformed the industry over the past year. The company’s enthralling growth trajectory is likely to continue after it reported better-than-expected earnings in the third quarter of 2018. The company also raised its 2018 earnings guidance. By enhancement of mid-scale brand and the acquisition of WoodSpring , as well as the transformation of the Comfort and Cambria brand, Choice Hotels is poised for growth. Earnings estimates for 2018 have been revised upward over the past 30 days, reflecting analysts’ optimism surrounding the company’s future earnings potential. However, high cost of operations and competition remain concerns. Total operating expenses in the first nine months of 2018 increased 7% year over year. Also, the hospitality industry is cyclical and a worsening of global economic conditions might in turn dent Choice Hotels’ revenues and profits.”

A number of other equities analysts have also weighed in on the stock. Wells Fargo & Co lowered their price objective on shares of Choice Hotels International from $86.00 to $82.00 and set a market perform rating on the stock in a research report on Thursday, November 15th. SunTrust Banks lowered their price objective on shares of Choice Hotels International to $80.00 and set a hold rating on the stock in a research report on Thursday, November 15th. Jefferies Financial Group set a $83.00 price objective on shares of Choice Hotels International and gave the company a hold rating in a research report on Friday, November 9th. JPMorgan Chase & Co. lowered their price objective on shares of Choice Hotels International to $71.00 and set an underweight rating on the stock in a research report on Friday, November 9th. Finally, ValuEngine lowered shares of Choice Hotels International from a buy rating to a hold rating in a research report on Thursday, October 11th. Two research analysts have rated the stock with a sell rating, eight have assigned a hold rating and one has given a buy rating to the company’s stock. Choice Hotels International presently has a consensus rating of Hold and an average target price of $82.00.

Shares of Choice Hotels International stock opened at $77.45 on Thursday. The firm has a market capitalization of $4.34 billion, a PE ratio of 26.89, a price-to-earnings-growth ratio of 2.36 and a beta of 1.06. Choice Hotels International has a 12 month low of $69.06 and a 12 month high of $85.35.

Choice Hotels International (NYSE:CHH) last announced its earnings results on Thursday, November 8th. The company reported $1.24 EPS for the quarter, beating analysts’ consensus estimates of $1.16 by $0.08. The business had revenue of $291.50 million for the quarter, compared to analysts’ expectations of $321.69 million. Choice Hotels International had a net margin of 17.26% and a negative return on equity of 98.61%. The company’s quarterly revenue was down 1.8% on a year-over-year basis. During the same period in the previous year, the company posted $0.95 EPS. Analysts predict that Choice Hotels International will post 3.85 earnings per share for the current fiscal year.

In related news, CEO Patrick Pacious sold 35,350 shares of Choice Hotels International stock in a transaction on Friday, September 21st. The shares were sold at an average price of $82.33, for a total value of $2,910,365.50. Following the transaction, the chief executive officer now directly owns 139,498 shares in the company, valued at approximately $11,484,870.34. The transaction was disclosed in a legal filing with the SEC, which is accessible through this link. Also, insider Patrick Cimerola sold 5,180 shares of the business’s stock in a transaction on Thursday, September 20th. The stock was sold at an average price of $83.05, for a total transaction of $430,199.00. Following the sale, the insider now owns 26,009 shares in the company, valued at $2,160,047.45. The disclosure for this sale can be found here. Over the last quarter, insiders sold 55,323 shares of company stock worth $4,553,317. 22.01% of the stock is currently owned by insiders.

Several hedge funds and other institutional investors have recently modified their holdings of CHH. Atlanta Capital Management Co. L L C boosted its position in shares of Choice Hotels International by 124.6% during the 3rd quarter. Atlanta Capital Management Co. L L C now owns 1,819,385 shares of the company’s stock worth $151,555,000 after purchasing an additional 1,009,194 shares in the last quarter. Brown Advisory Inc. boosted its position in shares of Choice Hotels International by 204.6% during the 2nd quarter. Brown Advisory Inc. now owns 632,068 shares of the company’s stock worth $47,783,000 after purchasing an additional 424,539 shares in the last quarter. Morgan Stanley boosted its position in shares of Choice Hotels International by 692.0% during the 3rd quarter. Morgan Stanley now owns 307,370 shares of the company’s stock worth $25,604,000 after purchasing an additional 268,559 shares in the last quarter. Epoch Investment Partners Inc. purchased a new stake in shares of Choice Hotels International during the 3rd quarter worth $18,285,000. Finally, FMR LLC purchased a new stake in shares of Choice Hotels International during the 3rd quarter worth $16,356,000. Institutional investors own 57.19% of the company’s stock.

Choice Hotels International Company Profile

Choice Hotels International, Inc, together with its subsidiaries, operates as a hotel franchisor worldwide. It operates through Hotel Franchising and SkyTouch Technology segments. The company franchises lodging properties under the brand names of Comfort Inn, Comfort Suites, Quality, Clarion, Sleep Inn, Econo Lodge, Rodeway Inn, MainStay Suites, Suburban Extended Stay Hotel, Cambria hotels & suites, and Ascend Hotel Collection.

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