Citi downgrades Huazhu on COVID-19 uncertainties after Goldman upgrade

Citi analyst Lydia Ling downgraded Huazhu Group to Neutral from Buy with a price target of $30, down from $40. The recovery of the company's China operation could be dampened by its European operation as COVID-19 spreads globally, which raised uncertainties in Q2, Ling tells investors in a research note. The analyst is also concerned that the disruptive impact from COVID-19 on China's hotel sector might not be short term only. Franchisees could be more cautious on hotel openings given pressured operating cash flow, says Ling. Goldman Sachs this morning upgraded Huazhu Group to Buy.