Never heard of Wayne, but here's a clip you may find
interesting:
Raymond James Ups Extended Stay To Buy From
Accumulate >STAY
Dow Jones News Service ~ January 17, 1997 ~ 11:56 am EST
NEW YORK (Dow Jones)--Raymond James & Associates analyst Harry
Venezia said he upgraded Extended Stay America Inc. (STAY) to buy
from accumulate in light of its merger announcement with Studio Plus
Hotels Inc. (SPHI).
The analyst also reiterated his buy rating on Studio Plus.
Under terms of the merger announced today, Extended Stay will
issue 1.2272 shares for each of the about 12.5 million issued and
outstanding shares of Studio Plus.
Based on yesterday's closing prices, Venezia said Studio Plus stock
was valued at $22 to $22.50.
On Nasdaq, shares of Studio Plus were up 6, or 40.7%, at 20 3/4 on
volume of 395,600 shares, compared with average daily volume of
146,500.
Extended Stay stock was down 5/8, or 3.4%, at 18 on volume of 1
million shares, compared with average daily volume of 92,000.
Venezia said that once the market interprets all the positives of the
merger, Extended Stay's price should start to rise.
The strategic merger will make the new Extended Stay dominant in
mid-price and economy extended-stay markets, he said. The new
company will compete against such concerns as Candlewood Hotel
Inc. (CNDL) and Homegate Hospitality Inc. (HMGT) in the mid-price
market, Venezia said. And will compete with Homestead Village Inc.
(HSD) and Suburban Lodges of America Inc. (SLAM) in the economy
market, he said.
The analyst said he expects revenue for the merged Extended Stay
to jump to $116 million this year and to $240 million in 1998,
compared with his 1996 estimate of $17 million for the stand-alone
company.
Cash flow for the stand-alone should be negative in 1996 on higher
corporate expenses, Venezia said, but the combined company should
have cash flow of $44 million in 1997 and $110 million in 1998.
(END) DOW JONES NEWS 01-17-97
11:57 AM |
