Zacks Analyst Blog Highlights Marriott, Choice Hotels, Playa Hotels and Bally’s
For immediate release
Chicago, IL – June 24, 2022 – Zacks.com announces the list of stocks featured in the analyst blog. Every day, Zacks Equity Research analysts discuss the latest news and events impacting stocks and financial markets. Stocks recently featured in the blog include: Marriott International, Inc. MAR, Choice Hotels International, Inc. CHH, Playa Hotels & Resorts NV PLYA and Bally’s Corp. BALY.
Here are highlights from Thursday’s analyst blog:
4 hotel stocks to buy for the summer vacation season
Concerns about rising prices are growing, but that hasn’t dampened Americans’ morale as they are in no mood to cut vacation plans and spending this summer. Even the huge rush, which forces several airlines to cancel hundreds of flights daily, does not prevent vacations.
Despite massive cancellations, leisure and business flights have exceeded pre-pandemic levels, according to the Mastercard Economics Institute: Travel 2022 Trends and Transitions. With the economy reopening, Americans are again aggressively planning vacations, leading to a surge in hotel bookings. Thus, hotel values like Marriott International, Inc., Choice Hotels International, Inc., Playa Hotels & Resorts SA and Bally’s Corp. are likely to benefit from it in the short term.
Americans go on vacation
Hotel bookings are on the rise again after suffering for more than two years as growing numbers of Americans plan to travel this summer. According to a survey by Vacationer, 80% of American adults plan to go on vacation this summer. Among them, 45% plan to travel more than once.
That means about 93 million people in the United States will travel at least once this summer, while 115 million will travel at least twice. According to the survey, at least 35 million more people will travel this year, while just 135 million American adults said they would travel in 2021.
A separate Deloitte survey, 2022 Summer Travel Survey, shows that nearly 46% of Americans are planning a vacation this summer in which they plan to stay in hotels or other types of paid accommodations. Additionally, 30% of travelers plan to spend more than in 2019, despite rising prices.
Naturally, more people traveling mean a tough time for hotels as more rooms will be booked. According to business intelligence data from Amadeus Demand360, hotel bookings have been flat with 2019 since March and are expected to increase over the summer.
In fact, global hotel bookings surpassed pre-pandemic levels for the first time in April and hit a new high of 63% in May from 60% in May 2019. The performance was even better in the United States, with occupancy reaching 68%, reflecting a 7% jump from pre-pandemic levels in 2019.
Flight bookings soar despite cancellations
According to Amadeus’ Demand360, 55% of hotel bookings in the US occurred 0-7 days before travel. So hotel bookings are likely to skyrocket as more and more people travel during the summer.
The biggest challenge, however, is that of the airlines. The increase in traffic forces them to cancel a record number of flights daily. Business and leisure travel surpassed pre-pandemic levels well before the summer.
According to Mastercard Economics Institute: Travel 2022 Trends and Transitions, global leisure flight bookings exceeded pre-pandemic levels by 25% in April. Medium-haul leisure flight bookings increased by 25% and 27% respectively during this period. This too will only increase in the days to come.
Additionally, according to Amadeus tracking data, inbound flights to the US will be the highest in the world during the months of June, July and August. This means that many people choose the United States as their favorite vacation destination this summer.
The pandemic has wreaked havoc on the travel and tourism industry over the past two years, with airlines and hotels suffering the most. However, with restrictions now eased and millions more vaccinated, leisure travel is on the rise again.
The travel boom makes this an opportune time to invest in hotel stocks. We’ve handpicked four such stocks that carry a Zacks rank of No. 1 (Strong Buy) or 2 (Buy). You can see the full list of today’s Zacks #1 Rank stocks here.
Marriott International, Inc. is a leading global hotel company focused on lodging management and franchising, following the spin-off of its timeshare business into a publicly traded company in November 2011. MAR’s classic upscale hotel brands include Marriott Hotels , Sheraton, Delta Hotels, Marriott Executive Apartments, and Marriott Vacation Club. Additionally, its distinctive upscale hotel brands include Westin, Renaissance, Le Méridien, Autograph Collection, Gaylord Hotels, Tribute Portfolio and Design Hotels.
Marriott International’s expected profit growth rate for the current year is 87.5%. The Zacks consensus estimate for current-year earnings has improved 8.5% over the past 60 days. MAR sports a No. 1 Zacks rank.
Choice Hotels International, Inc. is one of the largest hotel franchisors in the world. As of March 31, 2022, the CHH had 6,996 hotels open, representing nearly 577,714 rooms. Choice Hotels International operates in 40 countries and territories internationally and has a presence in 50 domestic states and the District of Columbia.
Choice Hotels International’s forecast earnings growth rate for the current year is 18.2%. The Zacks consensus estimate for current-year earnings has improved 3.7% over the past 60 days. CHH has a Zacks rank of #2.
Playa Hotels & Resorts SA owns, operates and promotes resorts primarily in Mexico and the Caribbean. PLYA owns and operates Hyatt Zilara and Hyatt Ziva Cancun, Hyatt Zilara and Hyatt Ziva Rose Hall Jamaica, Hyatt Ziva Puerto Vallarta and Hyatt Ziva Los Cabos.
Playa Hotels & Resorts NV’s expected profit growth rate for the current year is over 100%. The Zacks consensus estimate for current year revenue has improved more than 100% in the past 60 days. PLYA has a Zacks rank #2.
Bally’s Corp. owns and operates casinos, racetracks and licensed OTB licenses primarily in Colorado. BALY properties include Twin River Casino Hotel, Tiverton Casino Hotel, Hard Rock Hotel & Casino, Casino Vicksburg, Dover Downs Hotel & Casino, KC Casino, Golden Gates Casino, Golden Gulch Casino, Tuesday Gras Casino and Arapahoe Park Racecourse.
Bally’s Corporation’s forecast earnings growth rate for the current year is 20%. The Zacks consensus estimate for current year revenue has improved more than 100% in the past 60 days. BALY has a Zacks rank #2.
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