Deutsche Bank Raises FelCor Lodging Trust (FCH) Price Target

Deutsche Bank Securities analysts Chris Woronka and Tim Wengerd issued a company alert for FelCor Lodging Trust Inc FCH. The analysts noted that FelCor Lodging Trust Inc was pre-paying $177 million of its debt at a 27% discount, which will reduce the company's interest expenses. The analysts maintained their Hold rating for shares of FelCor Lodging Trust Inc and raised the price target to $6 per share, up from the previous price target of $5.75. The Deutsche Bank Securities analysts wrote, "Given the expected reduction in interest expense going forward and the 2Qto-date RevPAR, we have increased our quarterly and annual estimates for 2010 and 2011. Most of the increase goes into 2010, as we believe some growth is being pulled forward. We are increasing our price target to $6 from $5.75 given the increase to our 2011E. Our PT continues to be based on a blend of an 7.75% cap rate applied to 2011E NOI (50% of total), 11.5x 2011E EV/EBITDA (35%), and a replacement cost estimation (15%). We believe the news should be a positive for shares of FCH on Wednesday, but current share price vis-a-vis our PT keeps us at Hold."