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HST Hartstone

0.00
0.00 (0.00%)
Share Name Share Symbol Market Type Share ISIN Share Description
Hartstone LSE:HST London Ordinary Share GB0003703500 ORD 1P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.00 0.00% 0.00 -
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
0 0 N/A 0

Bullish US Jobs Report Breathes Life Into Hotel Stocks

07/08/2009 5:03pm

Dow Jones News


Hartstone (LSE:HST)
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A better-than-expected monthly jobs report Friday was a much-need piece of good news for the nation's embattled lodging industry.

Hotel stocks rose sharply after the Labor Department reported that U.S. job losses tapered off in July while the unemployment rate surprisingly fell to 9.4%, providing further evidence that the U.S. recession is nearing an end. An improving employment environment could promote more consumer spending, leisure and business travel.

Marriott International (MAR) rose 5.8% to $23.79 in recent trading while Starwood Hotels & Resorts Worldwide, Inc. (HOT) gained 8.42% to $28.33. Host Hotels & Resorts (HST) rose 7% to $10.66.

Nonfarm payrolls declined 247,000 in July, the Labor Department said Friday, the smallest drop since last August and below the 275,000 decline economists in a Dow Jones Newswires survey had expected. The report is "definitely a positive (for the) hotel business simply because if more people have jobs there is a greater propensity to spend on either business travel or leisure travel," said FBR Capital Markets lodging analyst C. Patrick Scholes in a report.

He noted that the hotel jobs data also came in slightly better than expected given the toll the brutal economic downturn has taken on the industry. Indeed, in leisure and hospitality accommodation 9,000 jobs were added in July from the month prior.

All types of hotels - from budget to luxury - have been cutting costs, including work force reductions, as tumbling occupancy and room rates have left some hotel companies without enough cash to cover expenses. Time-shares, a former industry profit center, are also suffering.

The lodging industry is also the commercial real estate market's most distressed sector, with only $1.2 billion in significant sales in the first half of the year, marking an 85% drop from the same period last year, according to a new report by Real Capital Analytics.

"Although sales of apartments and industrial properties increased from Q1 to Q2 and office sales have recently started to pop, hotel acquisitions continue to slide," the report said.

Underscoring the malaise, the $1.2 billion of volume in the first half of 2009 was a paltry sum compared with the $4.7 billion monthly average in 2006 and 2007, Real Capital's data showed.

-By A.D. Pruitt, Dow Jones Newswires; 212-416-2197; angela.pruitt@dowjones.com

 
 

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