Hilton Grand Vacations price target lowered to $38 from $50 at BofA

BofA analyst Shaun Kelley lowered the firm’s price target on Hilton Grand Vacations (HGV) to $38 from $50 and keeps a Neutral rating on the shares after Hilton Grand recently lowered fiscal year guidance 12% ex-Maui on weaker timeshare sales and also announced it is acquiring Bluegreen Vacations (BVH) for $1.5B in cash. While likely a good long-term strategic fit as Bluegreen increases the tour and owner pipeline, it is near-term leveraging and dilutive relative to Hilton’s stand-alone multiple, which likely weighed on the initial reaction, says the analyst, whose lower target reflects lower sales and lower finance income.