Host Hotels Hikes Dividend - Analyst Blog
June 16 2011 - 1:45PM
Zacks
Host Hotels & Resorts, Inc. (HST) a real
estate investment trust (REIT) recently hiked its quarterly cash
dividend by 1 cent to 3 cents per share. This translates into a
massive 50% increase over the earlier
dividend.
The
increased dividend will be paid on July 15, 2011, to stockholders
of record on June 30, 2011. This takes the annual dividend yield as
of June 15, 2011, to 76.0%.
The company
increased the first quarter common dividend by 1 cent to 2 cents
per share. As operations continue to improve, Host Hotels
expect to increase the common dividend over the next 2 quarters,
with the expectation of a full year dividend of $0.10 to $0.15 per
share.
At the end of first quarter 2011, Host Hotels' cash balance
stood at $154 million. Host Hotels has a strong balance
sheet, which provides the financial flexibility to aim at high-yielding
acquisitions, high ROI (return on investments) capital projects,
dividend payouts, and share buybacks.
This augurs well for its long-term growth. We believe the
company has enough cash and cash equivalents to provide optimum
shareholder value.
During the first quarter first quarter 2011 FFO (funds from
operations) stood at $77 million or 11 cents per share, compared to
$49 million or 8 cents per share in the year-earlier quarter. Fund
from operations, a widely used metric to gauge the performance of
REITs, is obtained after adding depreciation and amortization and
other non-cash expenses to net income.
Host Hotels is the largest lodging REIT with high quality
lodging assets in geographically diverse locations. Over the years,
the company has executed a focused and disciplined long-term
strategic plan to acquire high quality lodging assets in
hard-to-replicate areas which have the potential for significant
capital appreciation.
Host Hotels currently retain a Zacks #3 Rank, which translates
into a short-term Hold rating. We are also maintaining our
long-term Neutral recommendation on the stock. One of its
competitors, La Salle Hotel properties
(LHO) currently retains a Zacks #3 Rank.
HOST HOTEL&RSRT (HST): Free Stock Analysis Report
LASALLE HTL PRP (LHO): Free Stock Analysis Report
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