Back to top

Analyst Blog

Zacks Equity Research

Red Lion Inks Deal, Enters Kent

HOT H

 ZacksTrade Now

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at support@zacks.com or call 800-767-3771 ext.  9339.

Spokane, Washington-based Red Lion Hotels Corporation recently inked a franchise license agreement with the owners of a hotel located in Kent, Washington. The 60-guestroom property will now become Red Lion Inn & Suites Kent. This new property will be unveiled once the hotel is refurbished. Financial terms of the deal were not disclosed.

The new property is strategically located just 20 miles south of Seattle and in close proximity to several important venues such as ShoWare Center arena, Emerald Downs, Kent Events Center and the Great Wall Shopping Mall. Additionally, the hotel also offers various facilities such as an indoor pool, an exercise room and meeting space to its visitors.

We view the deal as strategically positive for both the parties. The deal paves the way for the owners of the hotel, Kent South Hospitality, to reap the benefits from Red Lion’s much greater scale and brand name. This will aid the property compete in the mid-scale market.

On the other hand, Red Lion will enjoy the excellent positioning of the property. The company had been in search of an asset in any of the strong markets in the I-5 passage through Washington and Oregon. Management at Red Lion believes that the location of the property will complement and highlight its brand better, once the renovation is complete.

Kent is a popular destination for both domestic and overseas visitors, which makes tourism an important aspect of its economy. Thus, this partnership is expected to increase Red Lion’s reach into the tourism friendly city of Kent. With the presence of an extensive coastline, Kent not only offers traditional seaside holiday resorts but many natural and historic attractions as well.

However, Red Lion’s new property will likely face stiff competition due to the presence of its peers like Starwood Hotels & Resorts Worldwide Inc. (HOT - Analyst Report) and Hyatt Hotel Corp. (H - Snapshot Report) in Kent. Red Lion currently carries a Zacks #3 Rank, which translates into a short-term ‘Hold’ rating.
 

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
DIXIE GRP IN DXYN 15.84 +7.90%
BOFI HLDG IN BOFI 85.30 +4.97%
RAMBUS INC RMBS 12.31 +4.41%
VIPSHOP HOLD VIPS 148.73 +4.35%
NETFLIX INC NFLX 345.74 +4.32%