On Tuesday, Citi reaffirmed its Neutral stance on Hyatt Hotels Corporation (NYSE:H), maintaining its $165.00 price target for the company's stock. The decision follows a review of Hyatt's second quarter 2024 performance and an update of the firm's operating assumptions, which include recent acquisitions and dispositions, revenue per available room (RevPAR) trends, and expectations for net unit growth over the year.
The updated model has led to a revision of the third quarter 2024 earnings per share (EPS) estimate, which is now set at $0.95, a slight decrease from the previous $0.99 estimate. This revision excludes expected gains on sales, which will be reflected in the reported third-quarter EPS but are not included in the operating EPS.
For the full year 2024, Citi's EPS estimate for Hyatt has been raised to $4.37, up from $3.59. This increase suggests a more optimistic view of the hotel chain's performance for the year. However, the forecast for the following year has been adjusted downwards, with the fiscal year 2025 EPS estimate now at $4.04, reduced from the earlier projection of $4.30.
The revised estimates incorporate the latest financial results and operational changes at Hyatt, including the impact of the hotel industry's market dynamics on its revenue and growth trajectory.
The Neutral rating indicates that Citi's outlook on Hyatt's stock remains cautious, balanced by the potential for growth against the backdrop of the company's recent strategic moves and market conditions.
In other recent news, Hyatt Hotels Corporation has been making significant strategic moves, including the sale of the Orlando Hyatt Regency and the acquisition of Standard International.
Financial services company Jefferies has raised its price target for Hyatt to $152, while maintaining a Hold rating. Similarly, Stifel and JPMorgan (NYSE:JPM) have also raised their price targets for Hyatt to $151 and $164 respectively.
Hyatt's acquisition of Standard International, the parent company of The Standard and Bunkhouse Hotels brands, is expected to bolster its presence in the lifestyle hotel market. The deal includes the formation of a new lifestyle group, 21 hotels under management, franchise, and license contracts, and more than 30 signed projects worldwide.
In terms of financial performance, Hyatt has reported a system-wide revenue per available room (RevPAR) increase of 4.7% in the recent quarter, primarily driven by group and business transient travel.
Furthermore, Hyatt has appointed Kinsey Wolf as its new Senior Vice President, Controller, and Chief Accounting Officer.
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