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Factors Setting the Tone for Hyatt's (H) Earnings in Q1

·3 min read

Hyatt Hotels Corporation H is scheduled to report first-quarter 2021 numbers on May 4, after the closing bell. In the last reported quarter, the company’s earnings missed the Zacks Consensus Estimate by 30.2%.

Which Way are Estimates Headed?

The Zacks Consensus Estimate for first-quarter bottom line is pegged at a loss of $1.33, compared with a loss of 35 cents reported in the prior-year quarter. The company’s bottom-line estimates have remained stable over the past 30 days.

The consensus mark for revenues stands at $479.2 million, suggesting a decline of 51.7% from the year-ago quarter.

Factors to Note

Hyatt’s first-quarter 2021 results are likely to reflect the negative impacts of the coronavirus pandemic. Although RevPAR and occupancy rate are likely to have improved sequentially, it is likely to remain well below the pre-pandemic level. With travel restrictions and quarantines in place, the company has been witnessing dismal Revpar worldwide. Earlier, the company had announced that first-half of 2021 will remain challenging but it expects meaningful recovery in second-half of 2021.

However, occupancy rates are improving in greater parts of China. Notably, in fourth-quarter 2020, occupancy level in Greater China was nearly 60%. However, high operating costs stemming from the pandemic might have weighed on the first-quarter margins.

Notably, the Zacks Consensus Estimate for Management and franchise fees is pegged at $59 million, which indicates a decline of 28% from $82 million reported in the previous quarter. The consensus mark for Owned and leased hotels revenues currently stands at $132 million, indicating a decline of 59.1% from $323 million in the year-ago quarter.

However, unit growth strategy and robust loyalty program may have benefited the company’s first-quarter performance.

Hyatt Hotels Corporation Price and EPS Surprise

Hyatt Hotels Corporation Price and EPS Surprise
Hyatt Hotels Corporation Price and EPS Surprise

Hyatt Hotels Corporation price-eps-surprise | Hyatt Hotels Corporation Quote

What the Zacks Model Unveils

Our proven model predicts an earnings beat for Hyatt this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.

Earnings ESP: Hyatt has an Earnings ESP of +7.29%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: The company carries a Zacks Rank #3.

Other Stocks With Favorable Combination

Here are other stocks from the Zacks Consumer Discretionary space that investors may consider, as our model shows that too have the right combination of elements to deliver an earnings beat this time around.

Boyd Gaming Corporation BYD has a Zacks Rank #3 and an Earnings ESP of +5.00%. You can see the complete list of today’s Zacks #1 Rank stocks here.

Choice Hotels International, Inc. CHH has a Zacks Rank #3 and an Earnings ESP of +17.47%.

Caesars Entertainment, Inc. CZR has a Zacks Rank #3 and an Earnings ESP of +9.32%.

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Choice Hotels International, Inc. (CHH) : Free Stock Analysis Report

Hyatt Hotels Corporation (H) : Free Stock Analysis Report

Caesars Entertainment, Inc. (CZR) : Free Stock Analysis Report

Boyd Gaming Corporation (BYD) : Free Stock Analysis Report

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