Hotel companies trade mixed in 3rd quarter

The hotel sector was hurt this summer as consumers cut back on vacation spending amid soaring fuel prices and the broader economic downturn. More recently, analysts have expressed concerns about the longer-term implications of cutbacks in corporate travel budgets, particularly in the troubled financial sector.

In a recent client note, Goldman Sachs analyst Steven Kent said he expects hotel shares to "grind lower in the coming 12 months."

Orient-Express Hotels Ltd. stock experienced the steepest drop, losing more than 40 percent during the quarter.

Take-over speculation has contributed to the volatility of the company's shares. Orient-Express is also waging a proxy fight with an investment group, which includes D.E. Shaw & Co., seeking to change the company's corporate governance structure. A shareholder meeting will be held on Oct. 10.

Shares of Starwood Hotels & Resorts Worldwide Inc. have fallen, too, due in part due to worries about weakening trends among foreign travelers. Starwood's stock has dropped more than 30 percent during the quarter.

Elsewhere, Wyndham Worldwide Corp. shares lost more than 15 percent in the quarter.

Shares of Gaylord Entertainment Co., on the other hand, have jumped in the third quarter due to its stable business model and speculation about investor action. Citi Investment Research analyst Joshua Attie has recommended Gaylord on its "defensive business model," which depends on large association meetings that are often booked several years in advance.

Shares also got a boost after Texas billionaire Robert Rowling, who owns Omni Hotels, raised his stake in the company to nearly 15 percent.

Gaylord shares jumped more than 10 percent in the third quarter.