H/AC FP
Hyatt Hotels Corporation - Ordinary Shares - Class A
Consumer
03/13/2023
Presented
| Date | 03/03/2023 |
| Price | $122.80 |
| Market Cap | $13.05B |
| Ent Value | $12.16B |
| P/E Ratio | 29.82x |
| Book Value | $34.77 |
| Div Yield | 0% |
| Shares O/S | 106.25M |
| Ave Daily Vol | 851,524 |
| Short Int | N/A |
Current
| Price | $151.58 |
| Market Cap | $15.21B |
| Hyatt 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, EAME/SW Asia Management and Franchising, and Apple Leisure Group. 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 consists of the management and franchising of properties located in Southeast Asia, Greater China, Australia, South Korea, Japan, and Micronesia. The EAME/SW Asia Management segment consists of its management and franchising of properties located primarily in Europe, Africa, the Middle East, India, Central Asia, and Nepal. The Apple Leisure Group segment consists of management and marketing of primarily all-inclusive resorts within the AMR Collection in Latin America The company was founded by Thomas Jay Pritzker in 1957 and is headquartered in Chicago, IL. |
Publicly traded companies mentioned herein: Accor SA (AC FP), Hilton Worldwide Holdings Inc (HLT), Hyatt Hotels Corp (H), InterContinental Hotels Group PLC (IHG), Marriott International Inc (MAR)
Highlights
When analyzing the travel industry, the presenter first focuses on the macroeconomic overlay where he expects the theme of “higher for longer” (higher spending, higher inflation, higher rates) to persist. Travel is different than other large expenses from a psychological standpoint; most people don’t travel often, so there remains pent up demand both domestically and globally despite high prices. The number of people traveling still hasn’t fully recovered from pre-COVID and it’s reasonable to assume that normalization will continue throughout 2023. While behavior in most markets across the world have moved closer to normal, China is in a unique position as consumption overall and demand for travel will be strong but there are structural impediments to outbound travel that will negatively impact international travel from China over the next two years. Based on that backdrop, the presenter is long shares of Hyatt Hotels Corp (H) and Accor SA (AC FP). Both companies are perceived as lower quality than Hilton, Marriott, and IHG. However, he sees additional similarities between the two businesses, namely that both are in the later stages of transitioning to asset light models and have significant exposures to China and Southeast Asia. As that region continues to recover, he sees upside to both stocks and the resumption of capital returns in two years from now.
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