Winners And Losers Of Q2: Choice Hotels (NYSE:CHH) Vs The Rest Of The Hotels, Resorts and Cruise Lines Stocks
Let’s dig into the relative performance of Choice Hotels (NYSE:CHH) and its peers as we unravel the now-completed Q2 hotels, resorts and cruise lines earnings season.
Hotels, resorts, and cruise line companies often sell experiences rather than tangible products, and in the last decade-plus, consumers have slowly shifted from buying "things" (wasteful) to buying "experiences" (memorable). In addition, the internet has introduced new ways of approaching leisure and lodging such as booking homes and longer-term accommodations. Traditional hotel, resorts, and cruise line companies must innovate to stay relevant in a market rife with innovation.
The 15 hotels, resorts and cruise lines stocks we track reported a mixed Q2. As a group, revenues along with next quarter’s revenue guidance were in line with analysts’ consensus estimates.
Stocks, especially growth stocks with cash flows further into the future, had a good end of 2023. On the other hand, this year has seen more volatile stock market swings due to mixed inflation data. However, hotels, resorts and cruise lines stocks have held steady amidst all this with share prices up 3.7% on average since the latest earnings results.
Choice Hotels (NYSE:CHH)
With almost 100% of its properties under franchise agreements, Choice Hotels (NYSE:CHH) is a hotel franchisor known for its diverse brand portfolio including Comfort Inn, Quality Inn, and Clarion.
Choice Hotels reported revenues of $435.2 million, up 1.8% year on year. This print was in line with analysts’ expectations, but overall, it was a slower quarter for the company with a miss of analysts’ earnings estimates.
"Choice Hotels generated another quarter of record financial performance amid a normalizing domestic RevPAR environment, demonstrating the strength of our versatile business model and proven growth strategy," said Patrick Pacious, President and Chief Executive Officer.
Interestingly, the stock is up 2.6% since reporting and currently trades at $127.24.
Read our full report on Choice Hotels here, it’s free.
Best Q2: Carnival (NYSE:CCL)
Boasting outrageous amenities like a planetarium on board its ships, Carnival (NYSE:CCL) is one of the world's largest leisure travel companies and a prominent player in the cruise industry.
Carnival reported revenues of $5.78 billion, up 17.7% year on year, outperforming analysts’ expectations by 1.9%. The business had an exceptional quarter with an impressive beat of analysts’ earnings estimates and operating margin estimates.
The market seems happy with the results as the stock is up 10.1% since reporting. It currently trades at $18.04.
Is now the time to buy Carnival? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: Marriott Vacations (NYSE:VAC)
Spun off from Marriott International in 1984, Marriott Vacations (NYSE:VAC) is a vacation company providing leisure experiences for travelers around the world.
Marriott Vacations reported revenues of $1.14 billion, down 3.2% year on year, falling short of analysts’ expectations by 5.9%. It was a disappointing quarter as it posted underwhelming earnings guidance for the full year.
As expected, the stock is down 12.6% since the results and currently trades at $73.92.
Read our full analysis of Marriott Vacations’s results here.
Soho House (NYSE:SHCO)
Boasting fancy locations in hubs such as NYC and Miami, Soho House (NYSE:SHCO) is a global hospitality brand offering exclusive private member clubs, hotels, and restaurants.
Soho House reported revenues of $305.1 million, up 5.6% year on year. This number was in line with analysts’ expectations. More broadly, it was a slower quarter as it logged a miss of analysts’ members estimates.
The stock is up 8% since reporting and currently trades at $5.24.
Read our full, actionable report on Soho House here, it’s free.
Hilton (NYSE:HLT)
Founded in 1919, Hilton Worldwide (NYSE:HLT) is a global hospitality company with a portfolio of hotel brands.
Hilton reported revenues of $2.95 billion, up 10.9% year on year. This result was in line with analysts’ expectations. Taking a step back, it was a mixed quarter as it also logged a decent beat of analysts’ operating margin estimates but underwhelming earnings guidance for the full year.
The stock is up 6.4% since reporting and currently trades at $220.35.
Read our full, actionable report on Hilton here, it’s free.
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