Jim Huang
Four Seasons Hotel
FSH-T
DON'T BUY
Dec 06, 2005
They have done very well in the past. What has happened in the last couple of years is that they have had some non-core operating problems, especially in developing countries. They are missing the cycle. All other hotels are doing well. The next quarter will be the telling one.
Stock is dependent on what happens on the international scene. With the international discord that exists it is vulnerable to another Bali incident. Expensive.
Looking at its price/earnings ratio, historically it's always been high because of the quality of the company and the special niche they have. Finds it attractive at the current level. There is some global activity.
Stock is off very sharply and even though it has declined substantially, it is expensive at over 30 X 2005 earnings. Doesn’t have a good earnings prospect.