Keefe, Bruyette & Woods Reports on DiamondRock Hospitality

Keefe, Bruyette & Woods commented on DiamondRock Hospitality DRH in a report released today. In the report, Keefe was positive in its outlook of the company. Keefe writes, “DRH announced the acquisition of the 712-room Radisson Lexington New York Hotel for $335M, or $471k per key, representing 13.5x 2012E EBITDA and a 6.7% 2012 implied cap rate. We are raising 2011/2012 FFO estimates to reflect the acquisition. Cap rate is favorable, in our view, given central location and potential rebranding opportunity.” Keefe currently has a Market Perform rating on DiamondRock and a price target of $12.50. Shares of DRH closed the trading day at $10.78, down $0.03 from the opening bell.