Benzinga | Jan 10, 2022 11:17AM EST

BofA Double Upgrades Hyatt On Lodging Recovery: What You Need To Know

Hyatt Hotels Corporation (NYSE:H) is a play on the recovery in the lodging sector, according to BofA Securities.

The Hyatt Hotels Analyst: Shaun Kelley upgraded Hyatt Hotels from Underperform to Buy while raising the price target from $85 to $110.

The Hyatt Hotels Takeaways: The rebound in Lodging C-Corps has been "faster than we anticipated," Kelley said in the upgrade note.

"We are Buy rated on Hyatt given the company's recovery runway relative to other C-corps, combined with limited inflation/labor risk in its franchised estate," he wrote.

"Hyatt is making important strides in its capital light transition, which should help close the valuation gap to peers as well," the analyst said.

"Hyatt's strong balance sheet also helps provide downside protection relative to many of our Lodging REITs," he added.

Kelley also downgraded three full-service lodging REITs. He downgraded Park Hotels and Resorts Inc (NYSE:PK) from from Buy to Neutral, Pebblebrook Hotel Trust (NYSE:PEB) from Buy to Neutral and Sunstone Hotel Investors (NYSE:SHO) from Buy to Underperform.