Wells Fargo Securities has begun covering the limited partner interests of Delek Logistics with an 'outperform' rating and a price target range of $25 to $28. Delek Logistics was spun out of Delek US Holdings last month at $21 per share but hasn't done much since. Wells analysts say the company (Ticker: DKL) should be able to generate earnings growth averaging 11 percent a year through 2017.
Avondale Partners analyst Fred Lowrance says investors could do a lot worse than buying Ryman Hospitality Properties shares now that it looks like the company will next year sport a dividend yield of about 6.5 percent. On top of that, he says, bringing the muscle of Marriott's sales group to the Gaylord family of hotels should boost cash flows back to Ryman. "We thus feel comfortable arguing that RHP should trade much closer to where peers have historically," he wrote clients this week.
Ryman shares (Ticker: RHP) have climbed more than 10 percent to about $37 since the company paid out its big one-time dividend last month. Lowrance sees them going to $49, up from his previous target of $48.
Fred Lowrance at Avondale Partners says Gaylord Entertainment shares are worth at least $48 based on the company's future profit potential as a real estate investment trust. The hotel manager this week paved the path toward a REIT conversion by buying back almost half of the shares held by TRT Holdings and agreeing to market the remainder. A reconstituted Gaylord should produce 2013 funds from operations of $190 million, Lowrance told clients Wednesday. "If shares trade more in-line with lodging REIT peers, we believe investors would be well-served accumulating shares at current levels," he wrote. Gaylord shares (Ticker: GET) are trading above $38 today and have of late been climbing back toward their four-and-a-half-year highs of about $40.
Over at RBC Capital Markets, analysts have again started covering shares of Tractor Supply. The firm has shares of the farm and ranch retailer (Ticker: TSCO) rated 'outperform' and sees them climbing to $105. Tractor Supply is changing hands this afternoon at almost $92.
Fred Lowrance at Avondale Partners has raised his price target on shares of Gaylord Entertainment following the company's early reporting of strong first-quarter numbers. Lowrance now sees the stock (Ticker: GET) climbing to $43, up from $37. The Q1 numbers, he said Wednesday morning, have him "feeling comfortable anticipating continued solid RevPAR performance and robust out-of-room spending trends."
On top of that, the company's word that it spent $3 million exploring strategic options has Lowrance thinking Robert Rowling's TRT Holdings could be circling for a full takeover. Nomura Securities' Harry Curtis thinks the same and says Gaylord's private-equity takeout value should approach $40.
Fred Lowrance says Gaylord Entertainment's booking and pricing strategy — the company has resisted putting too much future business on its books because it sees rates rising — appears to have begun to resonate with investors. Previewing the company's upcoming first-quarter results, the Avondale Partners analyst says "investors are becoming increasingly comfortable" with that approach as well as with a push to boost leisure business. Combine that with signs from fellow hotel operators that group demand is firming up and Lowrance sees Gaylord posting profits of 7 cents versus the consensus of 4 cents. At about 11 times estimated 2012 cash flow, Gaylord (Ticker: GET) "remains a compelling investment opportunity" — even though it's up 28 percent year to date.
Gaylord Entertainment's fourth-quarter earnings have been well received by a number of analysts. Both Kevin Milota at JPMorgan and Patrick Scholes at FBR Capital Marketshave lifted to $31 their price targets for shares of the Nashville-based hotel and convention center operator. Scholes had been at $26; Milota, at $25.
Fred Lowrance at hometown-based Avondale Partners has them both beat, though. He has hiked his price target to $37 from $34 and says 2012 looks set to be a more predictable year for Gaylord, especially now that the company's D.C.-area resort appears set to produce better numbers.
We also believe investors are becoming increasingly comfortable that GET’s booking/pricing strategy and initiatives aimed at attracting more higher-rated leisure visitors are working. As such, shares are likely to support a higher multiple more in-line with where other lodging companies with significant group exposure are trading (roughly 12x) as investor sentiment improves.
Two analysts covering Gaylord Entertainment have slashed their price targets on the stock but are taking decidedly different outlooks on the company following its Q3 loss. David Katz at Jefferies has slashed his price target to $20 from $27 and lowered his EBITDA outlook. He sees 2012 revenue per available room growing just 2.1 percent, which is at the low end of Gaylord's already cautious forecast. But at Avondale Partners, Fred Lowrance is still upbeat in the stock's prospects, pointing out that — despite softness at its Orlando and D.C. properties — the company is still on track to meet its original 2011 forecasts. Nevertheless, he has taken his target down to $28 from $51.
While investors are unlikely to assign a full multiple to any lodging company in this market, especially to a company like GET with market concentration issues, we still see ample upside opportunity in GET shares even after reining in multiples to historically low levels on lower 2012 earnings prospects.
Sam Margolin at Global Hunter Securities says Delek US Holdings should see its valuation rise now that it has acquired full control of Lion Oil. The deal, he says, gives the Brentwood-based company a broader platform that lowers its risk proflile and attracts more investors. He has launched coverage of Delek (Ticker: DK) with a 'buy' rating and a $20 price target.
Fred Lowrance at locally based Avondale Partners says Gaylord Entertainment "remains on track to achieve its lofty second half goals" even though there's some skepticism about the performance of the Washington, D.C., area, where the company runs its Gaylord National resort. But Lowrance says the property is likely to do better than the region as a whole, which will help drive momentum for the company (Ticker: GET) heading toward 2012.
We sense that some investors may have forgotten that prior year Opryland flood-related bookings adjustments wound up sending several groups to National (highest priced rooms in the GET system) at much lower Opryland rates — depressing 3Q’10 National rates. Any lingering softness is likely offset by robust Opryland performance as well as improving results at the Palms and Texan resorts.
Lowrance's Avondale colleague Richard Close is impressed with HealthStream's Q3 numbers — the momentum is "solid considering significant structural changes expected to occur in healthcare" — and says investors should consider taking advantage of today's pullback in the stock (Ticker: HSTM), which is due primarily to revenue coming in "only" in line with expectations. Close has reiterated his 'market outperform' rating and $17.50 price target.
Analysts Fred Lowrance at Avondale Partners and Andrew Didora at Bank of America Merrill Lynch have reacted quite differently to the second-quarter earnings report of Gaylord Entertainment, which included a lowering of some of the firm's revenue targets. Lowrance is sticking to his guns — an 'outperform' rating and $51 price target — and says the weakness Gaylord saw at its D.C.-area resort was to be expected and is being offset by Opryland's impressive comeback. Investors, he said, should step into Gaylord at its "depressed valuation."
Given its long booking window, we believe GET possesses some of the best visibility into future demand in the travel industry. With the optimistic tone of management’s forward-looking comments, the group recovery seems likely to continue in the intermediate-term.
Avondale Partners analyst Fred Lowrance says the Gaylord Opryland Resort & Convention Center is primed to deliver some big numbers this year and next for parent Gaylord Entertainment. After a visit last week with investor relations chief Patrick Chaffin, Lowrance wrote that it appears the company’s first-quarter softness endured through the end of June — Lowrance has lowered his Q2 cash-flow estimate 5 percent — but that demand for later this year and next suggests the corporate travel market is strengthening nicely.
“Existing estimates potentially understated the power of the inflection we are likely to see inresults,” Lowrance wrote in sticking to his ‘market outperform’ rating and $51 target.Shares of Gaylord (Ticker: GET) have recovered a bit from a spring slide and are now down about 12 percent year to date.
Over at Sidoti & Co. in New York, nursing home operator Advocat has been initiated with a ‘neutral’ rating. The Brentwood-based company, which has been improving its number primarily via a multi-year renovation program, has seen its stock (Ticker: AVCA) rise about 30 percent so far this year.
Avondale Partners analyst Fred Lowrance hit the road for a bit recently with Gaylord Entertainment President David Kloeppel and came away thinking the Street is overreacting to the company's soft first-quarter numbers. (Many investors and analysts focused on lower-than-expected future bookings, which are mainly the result of the company's strategy to hold back as pricing continues to improve.) And while Lowrance says the second quarter will likely be only "okay," higher corporate travel spending is pushing up prices across the country and has Gaylord positioned to reap the rewards starting later this year.
[W]e are convinced that everything is playing out according to plan, with GET well-positioned to keep pace with the industry's RevPAR recovery longer-term and realize benefits from increasing high-margin transient occupancy.
Lowrance has a "market outperform" on Gaylord and sees the stock rising by more than 50 percent to $51. A more muted endorsement came earlier this week from BGB Securities, which lowered its price target on Gaylord shares (Ticker: GET) to $35 but said longer-term investors will do well with the company.