Zacks Investment Research downgraded shares of Starwood Hotels & Resorts Worldwide Inc. (HOT) from OUTPERFORM to NEUTRAL on May 09, 2013, with a target price of $70.00.
We are reverting to a Neutral recommendation on Starwood from Outperform given the pressure on revenues. Although Starwood's first-quarter 2013 earnings per share grew year over year, the decline in revenues concerns us. Persistently weak economic conditions in Europe and Argentina, slowdown in China and budget sequestration in the US may limit sales growth, going forward. Moreover, we believe, some of the positive attributes of the company like a strong pipeline, significant international exposure, its asset disposition strategy, and limited asset supply in North America are already reflected in the current share price, thus leaving lesser room for further increase.
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