In a concerted effort to consolidate its hotel business, Loews Hotels & Resorts, a wholly owned-subsidiary of Loews Corporation (L - Free Report) , will open a new hotel in Chicago.
The Loews Chicago Hotel, which is scheduled to open in Jan 2015, will have 400 rooms, a restaurant, more than 25,000 square feet of meeting space, several outdoor terraces, spa/fitness center and an outdoor rooftop including a pool overlooking the city.
Recently, Loews Hotels & Resorts announced that it has started the construction of the 1,800-room Cabana Bay Beach Resort at Universal Orlando, scheduled to open in 2014. This hotel will be co-owned by Universal Parks & Resorts.
These efforts by Loews Hotels & Resorts are in sync with its strategies to acquire and develop properties in Boston, Chicago, San Francisco, Washington, D.C., New York, Dallas, Toronto and Seattle. The company plans to add assets to its portfolio with capital at disposal to an expanding customer base. These new additions support Loews’ plans of nearly doubling its hotel count by the next three to five years. It aims at adding more hotels to its portfolio in order to take the count from 18 to over 30. The company also expects a threefold increase in its net income in the next three years.
As a part of the goal, Loews Hotels & Resorts had also acquired two hotels - Madison Hotel in Washington, D.C. and Renaissance Hotel & Spa in Hollywood, California - in 2012.
Among other segments, Loews Hotels posted highest revenue growth in the third quarter, up 19.5% year over year. We believe that the addition of this hotel will help the company continue delivering such robust numbers.
Loews is expected to release its fourth-quarter and full year 2012 results on Feb 11. The Zacks Consensus Estimate for the fourth quarter is 37 cents, while the same for the full year 2012 is $1.80. These represent a year-over-year decline of 52.6% and 33.5% for the respective periods.
Loews carries a Zacks Rank #3 (Hold) and a long-term Neutral recommendation. Its peer CNO Financial Group, Inc. (CNO - Free Report) carries a Zacks Rank #2 (Buy).