The New York investment bank UBS Warburg downgraded ratings on several hotel lodging companies it covers, including Royal Palm Beach-based Innkeepers. It also downgraded Host Marriott, Starwood Hotels Choice Hotels, Four Seasons, Hilton Hotels, Marriott International, MeriStar Hospitality and MeriStar Hotels.

Meanwhile, the investment bank maintained hold ratings on Fort Lauderdale-based Extended Stay. It also maintained hold ratings on FelCor Lodging and Wyndham International.

"We are reducing our 2001 and 2002 RevPAR growth expectations for our covered companies by 50% to approximately 2% to 2.5% from 4% to 5%," according to the UBS Warburg report.

"This results in us lowering our 2001 and 2002 earnings projections, too, which is the primary reason for our downgrading the stocks. The high correlation between lodging stock prices and expenditure growth indicates that lodging stock prices are likely to decline as expenditure growth moderates," the report states.

The bank attributed its outlook to interviews and research culled from sources such as American Express Travel, which indicates US corporations are considering cutbacks in their travel budgets.

"We believe the evidence of reduced corporate employee travel was confirmed in the feedback that we received about February transient business travel trends," according to the report.

Opening weak, Extended Stay closed down 25 cents Wednesday at $15.16 on volume of 860,000. The price has fallen from a recent high of $19.06 on Feb. 16. Also opening weak Wednesday morning, shares in Innkeepers closed down 12 cents Tuesday at $10.82 on volume of 177,600. It has fallen from a recent high of $12.25 on Jan. 29.