Zacks Analyst Blog Highlights: Linktone, China Mobile, Winston Hotels and Hilton Hotels

Business Wire, Feb 14, 2007

CHICAGO -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Linktone (Nasdaq:LTON), China Mobile (NYSE:CHL), Winston Hotels (NYSE:WXH) and Hilton Hotels (NYSE:HLT).

See the latest posts to the Analyst Blog by visiting: http://at.zacks.com/?id=2673

Here are highlights from Tuesday's Analyst Blog:

Linktone Gets Downed to Hold

We are pessimistic about Linktone's (Nasdaq:LTON) financial results for the fourth quarter because of the effect of China Mobile's (NYSE:CHL) policy change. Although we think Chinese wireless value-added service providers still have great potential to grow their businesses and Linktone's experience on the 2G platform in China will help the company make full use of the 3G opportunity in the future, we don't think Linktone's performance will improve in 2007.

Overall, we think current stock price fairly represents the company's short-term prospects. Therefore, we are downgrading Linktone from Buy to Hold.

The wireless value-added services business (WVAS) has strong prospects in China. There were about 460 million mobile users in China at the end of December 2006. However, the penetration rate of mobile users in China was only about 33%. It is estimated that the number of mobile users in China will be more than 700 million in 2010.

The Chinese government and telecom operators regulate the operation of wireless service providers in China. The policy changes from Chinese state-owned telecom operators and regulation changes from Chinese government have great effect on service providers business.

Ahead of Earnings, WXH a Buy

We reiterate our Buy rating on shares of Winston Hotels (NYSE: WXH) ahead of the company's announcement of Q4 financial results on February 15. Winston has a strong existing property portfolio that is delivering solid internal growth, a development pipeline that will both add rooms and improve the quality of the company's owned assets, and a unique hotel financing program that is providing attractive earnings growth.

We will be looking for further evidence that the company's development pipeline is on track. Any definitive news on the new "aloft" brand hotels would be a positive. There should also be an update on the status of the two New York City [NYC] hotels currently under development. The company is expected to show a strong operating performance with RevPAR [revenue per available room] within management's guidance range.

On the last conference call, management stated that one of the two NYC properties (Tribeca) had been approved by Hilton Hotels (NYSE:HLT) for a Hilton Garden Inn franchise, while negotiations were underway with Hilton Hotels to also brand the other NYC property (Chelsea) as Hilton Garden Inn. We anticipate that the Chelsea property has been approved for the Hilton Garden Inn brand.

See the latest posts to the Analyst Blog by visiting http://at.zacks.com/?id=2645

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