XHR - Pebblebrook Xenia Sunstone downgraded at RayJay on lack of near-term positive catalysts

• Raymond James analyst William Crow on Friday downgraded shares of lodging REITs Pebblebrook Hotel Trust ( NYSE: PEB ) and Xenia Hotels & Resorts ( NYSE: XHR ) to Market Perform from Outperform, and cut Sunstone Hotel Investors ( NYSE: SHO ) to Underperform from Market Perform, in response to higher interest rates and an increasingly uncertain macroeconomic outlook for next year.
• During the next few months, "the recovery in hotel fundamentals is more likely to stall," Crow wrote in a note, adding "investor sentiment remains negative, and identifying a near-term positive catalyst is challenging."
• For the long-term, though, the recovery in lodging "should benefit from low supply growth, recovery in business transient travel, China’s eventual reopening, and a longer-term benefit from higher overall leisure and dual purpose (bleisure) travel," according to the note.
• Take a look at the Quant system's screener for the best-rated lodging REITs.
• PEB, XHR and SHO were little changed at the time of writing. Last week, Pebblebrook Hotel got hit with a downgrade at BMO due to its high leverage and broader macro risks .

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