Goldman Sachs upgraded Hilton Grand Vacations to Buy from Hold on Tuesday amid hopes for a recovery in consumer demand. Goldman also lifted the stock’s price target to $29 (27.5% upside potential) from $22.50.
Goldman Sachs analyst Stephen Grambling believes that a “rapid recovery” in demand for vacation ownership along with limited cash burn and the improved financial market situation would drive Hilton Grand Vacations’ (HGV) consensus estimate for fiscals 2021 and 2022.
Lockdown measures implemented by global governments to contain the COVID-19 spread have been severely hurting club, resort, and hotel related businesses. On July 30, the vacation resort operator reported that its 2Q revenues plunged 72.9% to $123 million year-over-year. The company reported a loss per share of $0.56, compared with the year-ago quarter’s earnings per share of $0.43. (See HGV stock analysis on TipRanks).
Currently, the Street has a cautiously optimistic outlook on the stock, with a Moderate Buy analyst consensus. The average price target of $24.80 implies upside potential of 9.1% to current levels. Shares are down nearly 33.9% year-to-date.
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