Analyst: Drop This Hospitality Stock Now

The analyst also slashed their price target on RHP to $77 from $80

by Lillian Currens

Published on Jul 9, 2019 at 3:04 PM

The hotel name Ryman Hospitality Properties Inc (NYSE:RHP) is eyeing its worst day since December, down 3.6% at $77.79, on a downgrade from J.P. Morgan Securities. The analyst -- which said they're exercising caution on U.S. lodging companies, given the industry's recent trends and share performance -- cut their rating to "underweight" from "neutral." The brokerage firm also slashed its RHP price target to $77 from $80, representing a discount to yesterday's close. 

The bear note has RHP set to close below the $78 region for the first time in nearly six months. Since spiking at a seven-month high above $87 in mid-May, the stock has cooled considerably, with its last attempt at a rally halted by its 80-day moving average. 

Should the rest of the brokerage bunch follow suit, the Grand Ole Opry owner could start to feel even more downward pressure. Prior to today's drubbing, RHP held four "buy" or better ratings, and two "holds." Plus, the stock's consensus 12-month price target of $90.50 is at more than a 16% premium to current levels. 

On the other hand, RHP's Schaeffer's put/call open interest ratio (SOIR) of 5.05 is in the 92nd percentile of its annual range. This suggests that short-term option players have rarely been more put-heavy during the past 12 months. However, it's worth noting that absolute options volume tends to run light on Ryman Hospitality shares, with peak open interest among all series at the July 75 put, home to just 104 contracts.

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