Hilton Worldwide Holdings Inc. HLT is firing on all cylinders in order to maintain position as the fastest-growing global hospitality company. The company’s All Suites brand touched multiple milestones in 2018. The brand, which includes Embassy Suites by Hilton, Homewood Suites by Hilton, and Home2 Suites by Hilton, has opened the 30th property in Canada and 1,000th property overall.
Last year, All Suites made significant progress in Canada and successfully tapped on the robust growth in tourism. The company said that more than 20% of all Hilton properties in Canada are under the All Suites brand.
The brands are being expanded with the introduction of Homewood Suites by Hilton in Latin America and Embassy Suites by Hilton in the Middle East. The company intends to keep expanding in America and Asia with over 25 properties in its pipeline and more than 580 properties overall.
Meanwhile, Homewood Suites by Hilton gained traction in Mexico and Canada through the establishment of properties last year. Lastly, Home2 Suites by Hilton opened its 86 property in North America.
Shares of Hilton have gained 19% in the past three months, outperforming its industry’s rally of 12.7%.
Expansion to Drive Growth
As of Dec 31, 2018, Hilton's development pipeline comprised more than 2,400 hotels, with more than 364,000 rooms throughout 103 countries and territories — including 35 countries and territories, where Hilton currently does not have any running hotels. Additionally, 195,000 rooms in the development pipeline and 184,000 rooms were under construction outside the United States. For 2019, the company anticipates net unit growth of 6.5%.
Hilton’s broad geographic diversity lowers the effect of volatility in individual markets. More than half of the company’s pipeline is located outside the United States. More than 30% of the pipeline is located in the Asia-Pacific region, where demand has been high. Also, a growing middle-class population in China is creating demand for hospitality services. Further, Europe’s RevPAR trend is being supported by favorable exchange rates as well as strength in regions like Spain, the U.K., Germany and Turkey.
Zacks Rank & Other Key Picks
Currently, Hilton carries a Zacks Rank #1 (Strong Buy).
A few other top-ranked stocks in the Zacks Consumer Discretionary sector are Deckers Outdoor Corporation DECK, Skechers U.S.A., Inc. SKX and NIKE, Inc. NKE.
While Deckers Outdoor sports a Zacks Rank #1, NIKE and Skechers carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Deckers Outdoor’s long-term earnings are expected to grow 11.9%.
NIKE’s long-term earnings are likely to rise 12.3%.
Skechers U.S.A long-term earnings are estimated to grow 7%
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Hilton Worldwide Holdings Inc. (HLT) : Free Stock Analysis Report
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