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Hyatt Hotels Corp (H)
NYSE:H
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Hyatt Hotels
(NYSE:H)64Neutral
Positive Factors
Acquisition Strategy
Hyatt's acquisition of Playa Hotels is expected to increase its stream of asset-light management fees and strengthen its portfolio.
New Brand Launch
Hyatt has announced a new Upper Midscale brand called Hyatt Select, a conversion focused select service brand initially targeted at the Americas, before plans to scale the brand globally.
Negative Factors
Financial Performance
Hyatt experienced a 9% drop in stock price due to a 7% EBITDA miss and full-year guidance that was 4% below consensus.
Investor Concerns
There has been investor concern around the transaction due to the perceived complexity and potential delay in the asset-light strategy.
Hyatt Hotels (H) vs. S&P 500 (SPY)
Market Cap
$13.45B
Dividend Yield0.43%
Average Volume (3M)804.95K
Price to Earnings (P/E)11.1
Beta (1Y)1.31
Revenue Growth-6.41%
EPS Growth511.40%
CountryUS
Employees227,000
SectorConsumer Cyclical
Sector Strength53
IndustryHotels, Lodging & Leisure
Share Statistics
EPS (TTM)12.44
Shares Outstanding42,645,073
10 Day Avg. Volume814,396
30 Day Avg. Volume804,949
Financial Highlights & Ratios
PEG Ratio0.02
Price to Book (P/B)N/A
Price to Sales (P/S)2.02
Price to Cash Flow (P/CF)14.30
P/FCF Ratio14.30
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$164.17Price Target Upside19.61% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering16
Hyatt Hotels Business Overview & Revenue Model
Company DescriptionHyatt Hotels Corp. engages in the development and management of resort and hotel chains. It operates through the following segments: Owned and Leased Hotels; Americas Management and Franchising; ASPAC Management and Franchising; and EAME/SW Asia management and Franchising. The Owned and Leased Hotels segment offers hospitality services and hotels. The Americas Management and Franchising segment consists of properties located in the United States, Latin America, Canada, and the Caribbean. The ASPAC Management and Franchising segment includes of its management and franchising of properties located in Southeast Asia, Greater China, Australia, South Korea, Japan and Micronesia. The EAME/SW Asia Management segment comprises of its management and franchising of properties located primarily in Europe, Africa, the Middle East, India, Central Asia, and Nepal. The company was founded by Thomas Jay Pritzker in 1957 and is headquartered in Chicago, IL.
How the Company Makes MoneyHyatt Hotels Corporation primarily generates revenue through several key streams: room rentals, food and beverage sales, and other associated services offered in their hotels, such as spa services, conferences, and events. Additionally, the company earns income through management and franchise fees from properties it does not own but operates under its brand names. Hyatt's revenue is significantly influenced by its strategic partnerships and global market presence, which allow the company to leverage its brand and expand its footprint across diverse geographical locations.
Hyatt Hotels Financial Statement Overview
Summary
Hyatt Hotels has shown solid revenue and profit growth post-pandemic, with improving margins. The balance sheet shows moderate leverage, but a declining equity ratio poses a potential risk. Strong cash flow performance supports operations effectively.Income Statement
Hyatt Hotels showed strong revenue growth of 12.4% from 2022 to 2023, rebounding significantly from pandemic lows. Gross profit margin improved to 49.6% in 2023, and the net profit margin increased to 3.3%, indicating a recovery in profitability. However, the EBIT margin was only 4.8%, reflecting room for improvement in operational efficiency.70
Positive
Balance Sheet
The company's debt-to-equity ratio stood at 0.95 in 2023, suggesting balanced leverage. However, the equity ratio declined to 27.8%, highlighting decreased equity relative to assets. Return on equity was relatively low at 6.2%, indicating moderate profitability on shareholder equity.65
Positive
Cash Flow
Hyatt's free cash flow grew by 26.6% in 2023, showing strong cash generation. However, the operating cash flow to net income ratio was 3.64, indicating reliance on cash flow for covering net income shortfalls. Free cash flow to net income ratio was 2.72, showing good cash conversion.60
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 6.65B | 6.67B | 5.89B | 3.03B | 2.07B | Gross Profit |
| 3.30B | 1.32B | 1.29B | 425.00M | -1.00M | EBIT |
| 2.75B | 322.00M | 363.00M | -242.00M | -794.00M | EBITDA |
| 2.11B | 799.00M | 789.00M | 68.00M | 0.00 | Net Income Common Stockholders |
| 1.30B | 220.00M | 455.00M | -222.00M | -703.00M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 1.28B | 896.00M | 1.15B | 1.19B | 1.88B | Total Assets |
| 13.32B | 12.83B | 12.31B | 12.60B | 9.13B | Total Debt |
| 4.06B | 3.37B | 3.45B | 4.36B | 3.65B | Net Debt |
| 3.05B | 2.49B | 2.46B | 3.40B | 2.44B | Total Liabilities |
| 9.50B | 9.27B | 8.61B | 9.04B | 5.92B | Stockholders Equity |
| 3.55B | 3.56B | 3.70B | 3.56B | 3.21B |
| Cash Flow | Free Cash Flow | |||
| 463.00M | 599.00M | 473.00M | 204.00M | -733.00M | Operating Cash Flow |
| 633.00M | 800.00M | 674.00M | 315.00M | -611.00M | Investing Cash Flow |
| 81.00M | -365.00M | 416.00M | -1.77B | -736.00M | Financing Cash Flow |
| -618.00M | -578.00M | -1.11B | 1.29B | 1.52B |
Hyatt Hotels Technical Analysis
Negative
137.25
Price Trends
152.85
Negative
153.88
Negative
150.70
Negative
Market Momentum
-4.87
Positive
33.21
Neutral
36.20
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For H, the sentiment is Negative. The current price of 137.25 is below the 20-day moving average (MA) of 148.49, below the 50-day MA of 152.85, and below the 200-day MA of 150.70, indicating a bearish trend. The MACD of -4.87 indicates Positive momentum. The RSI at 33.21 is Neutral, neither overbought nor oversold. The STOCH value of 36.20 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for H.
Hyatt Hotels Risk Analysis
Hyatt Hotels disclosed 53 risk factors in its most recent earnings report. Hyatt Hotels reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Hyatt Hotels Peers Comparison
Overall Rating
UnderperformOutperform
Sector (60)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $8.11B | 28.93 | 44.46% | 1.43% | ― | 6.40% | |
71 Outperform | $6.75B | 23.29 | -661.94% | 0.80% | 2.63% | 23.39% | |
68 Neutral | $63.42B | 42.93 | -41.19% | 0.23% | 9.17% | 42.78% | |
66 Neutral | $74.66B | 32.52 | -144.82% | 0.91% | 5.85% | -18.43% | |
64 Neutral | $13.45B | 11.05 | 36.54% | 0.43% | -6.41% | 511.40% | |
61 Neutral | $19.94B | 32.57 | -27.16% | 1.22% | 6.34% | -11.99% | |
60 Neutral | $13.01B | 10.45 | 0.79% | 3.53% | 1.60% | -22.47% |
* Consumer Cyclical Sector Average
Performance Comparison
H
Hyatt Hotels
137.25
-19.94
-12.69%
CHH
Choice Hotels
144.40
30.71
27.01%
IHG
Intercontinental Hotels Group
125.78
20.40
19.36%
MAR
Marriott International
270.80
25.39
10.35%
HLT
Hilton Worldwide Holdings
259.56
56.28
27.69%
WH
Wyndham Hotels & Resorts
104.37
30.69
41.65%
Hyatt Hotels Earnings Call Summary
Earnings Call Date: Feb 13, 2025 | % Change Since: -15.25% | Next Earnings Date: May 7, 2025
Earnings Call Sentiment Positive
The earnings call highlights strong growth in membership, RevPAR, and positive future outlook, while addressing challenges in the Greater China market and impacts from asset sales and external factors like the Lindner Group insolvency. Despite some challenges, the growth prospects and financial performance indicate a largely positive sentiment.Highlights
Record Membership Growth
World of Hyatt membership reached approximately 54 million members at year-end, a 22% increase over last year. Multi-room night penetration set a record high, and spend on co-branded credit cards increased by 18% in 2024 compared to 2023.
Strong RevPAR Growth
Fourth quarter system-wide RevPAR increased 5%, with a 4.6% increase for the full year. Business transient revenue was up 12% for the year, benefiting major urban markets in the U.S.
Expansion in Luxury and Lifestyle
Opened several notable luxury hotels including Park Hyatt London and Grand Hyatt Deer Valley, with plans for continued growth in luxury and lifestyle offerings.
Positive Outlook for 2025
Expect full year system-wide RevPAR growth of 2% to 4% in 2025, with a strong pipeline of new hotel openings and net rooms growth expected to range from 6% to 7%.
Financial Performance and Liquidity
Reported gross fees of $294 million in Q4, up 17%. Adjusted EBITDA increased by approximately 20% compared to last year, with a strong balance sheet including $2.9 billion in total liquidity.
Lowlights
Challenges in Greater China
RevPAR in Greater China was flat compared to last year, although this was an improvement from the previous quarter.
Distribution Segment EBITDA Decline
Distribution segment adjusted EBITDA declined by approximately $4 million due to lower than anticipated booking volumes and external factors such as hurricane Milton.
Impact of Asset Sales on EBITDA
Adjusted EBITDA for the first quarter of 2025 is expected to be negatively impacted by approximately $40 million due to real estate dispositions completed in 2024.
Uncertainty with Lindner Group
A franchisee, Lindner Group, filed for insolvency, leading to conservative assumptions in net rooms growth outlook.
Company Guidance
In the call, Hyatt provided guidance for 2025, anticipating a system-wide RevPAR growth of 2% to 4% compared to 2024, driven by strong group and business transient demand in the U.S. They expect net rooms growth in the range of 6% to 7%, with gross fees projected to increase by 11% to $1.2 to $1.23 billion, partly due to the addition of new acquisitions. The adjusted EBITDA is expected to rise by 11% to $1.1 to $1.15 billion, though impacted by prior real estate dispositions. Adjusted free cash flow is forecasted between $450 million and $500 million, excluding deferred cash taxes. Hyatt's capital allocation strategy remains focused on maintaining an investment-grade rating and returning excess cash to shareholders, with expectations to resume capital returns in 2025 post the Playa transaction.Hyatt Hotels Corporate Events
M&A TransactionsBusiness Operations and StrategyFinancial Disclosures
Hyatt Reports Strong 2024 Financial Results and Strategic Plans
Positive
Feb 13, 2025
On February 13, 2025, Hyatt Hotels Corporation reported its financial results for the fourth quarter and full year of 2024, highlighting a 4.6% increase in full year RevPAR and a net income of $1,296 million. The company executed several strategic acquisitions, including Standard International and Bahia Principe, and announced plans to acquire Playa Hotels & Resorts N.V. for $2.6 billion. Hyatt’s strategic focus on expanding its portfolio and asset-light model positions it to exceed a 90% asset-light earnings mix by 2027, benefiting stakeholders through improved operational efficiency and shareholder returns.
M&A TransactionsBusiness Operations and Strategy
Hyatt Hotels Acquires Playa Hotels & Resorts
Positive
Feb 10, 2025
On February 9, 2025, Hyatt Hotels Corporation announced entering into a purchase agreement to acquire all outstanding shares of Playa Hotels & Resorts for approximately $2.6 billion. The acquisition is set to enhance Hyatt’s all-inclusive platform, expanding its portfolio and management agreements for luxury all-inclusive properties. The transaction is expected to close later in the year, pending regulatory and shareholder approvals, and it aligns with Hyatt’s asset-light strategy, as the company plans to sell off Playa’s owned properties post-acquisition.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.