Truist cuts Park Hotels stock rating, slashes price target to $11

Published 30/05/2025, 11:50
Truist cuts Park Hotels stock rating, slashes price target to $11

On Friday, Truist Securities revised its stance on Park Hotels & Resorts (NYSE:PK), downgrading the stock from Buy to Hold and significantly reducing the price target from $16.00 to $11.00. The adjustment follows a reassessment of the company’s financial projections for the coming years. Truist Securities now expects Park Hotels & Resorts to achieve an EBITDA of $590 million in 2025, a decrease from the previous estimate of $613 million. Additionally, the firm’s adjusted funds from operations (AFFO) per share estimate for 2025 has been lowered to $1.78 from $1.86.

Looking further ahead, Truist Securities has also revised its 2026 projections for the hotel and resort company. The expected EBITDA for 2026 has been adjusted to $572 million from the earlier forecast of $629 million. Correspondingly, the AFFO per share forecast for 2026 has been altered, now anticipated to be $1.64, down from the prior estimate of $1.99.

The new price target of $11 is based on a reduced multiple of 11.0 times the estimated 2026 EBITDA, a decrease from the previous multiple of 11.5 times. According to Truist Securities, the stock is currently trading at multiples of 10.0 times and 10.8 times the firm’s estimated EBITDA for 2025 and 2026, respectively.

The changes in Truist Securities’ outlook for Park Hotels & Resorts reflect a more conservative valuation of the company’s future financial performance. The revised price target and stock rating suggest a tempered expectation for the company’s growth and profitability in the next few years.

In other recent news, Park Hotels & Resorts Inc . announced a significant miss in its Q1 2025 earnings per share (EPS), reporting a loss of $0.29 against an expected gain of $0.08. Despite this, the company’s revenue of $630 million slightly exceeded projections of $614.12 million. Additionally, Park Hotels completed the sale of Hyatt Centric Fisherman’s Wharf in San Francisco for $80 million, aligning with its strategy to divest non-core assets. Analyst firms have adjusted their outlooks on Park Hotels, with Citi maintaining a Buy rating but lowering the price target to $13, and Evercore ISI downgrading the stock to In Line, also targeting $13. Jefferies, however, increased the price target to $11 while maintaining a Hold rating, reflecting the challenges Park Hotels faces in its valuation. The company continues to focus on strategic investments, including a $100 million renovation of the Royal Palm South Beach in Miami, expected to enhance guest experience and double the hotel’s EBITDA. Park Hotels remains committed to reshaping its portfolio and maximizing shareholder returns through strategic asset sales and reinvestment.

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