Why Is SEI Investments (SEIC) Down 5.3% Since Its Last Earnings Report?
Hilton Worldwide Holdings Inc.’s HLT upper-midscale brand, Hampton by Hilton, announced the launch of nine properties. Notably, these new properties were launched both domestically and internationally.
Noteworthy properties include Hampton Inn & Suites by Hilton Detroit/Warren in Michigan, Hampton Inn & Suites by Hilton St. George in Utah and Hampton by Hilton Dortmund Phoenix See in Germany. The brand also proliferated its presence in China by the addition of Hampton by Hilton Shunde Longjiang, and Foshan and Hampton by Hilton Suzhou Xiangcheng District. The company also expanded its presence in Massachusetts, California, Oklahoma and Canada.
We observe that shares of Hilton have rallied 40% in the past year, outperforming the industry’s gain of 32%.
Continual Expansion in Focus
The move underscores Hilton’s absolute focus to aggressively expand its brands in both domestic and international markets. To maintain its position as the fastest-growing global hospitality company, Hilton is continuing to drive unit growth.
In 2017, Hilton witnessed net unit growth of 18,400 rooms. Further, the company expanded its footprint across new countries for a total of 105 countries and territories. For 2018, the company projects an approximate 6.5% net unit growth. It also continues to have more rooms under construction in Europe, the Middle East and Asia Pacific than any other hotel chain. The company expects greater international expansion in 2018.
Geographic Diversity Aids RevPAR Growth
Hilton continues to look for expansion in its geographic footprint, as diversity lowers the effect of volatility in individual markets. Evidently, Mexico and Canada have been experiencing strong leisure demand, leading to solid revenue per available room (RevPAR) growth. Further, Europe’s RevPAR trends are being supported by favorable exchange rates as well as strength in regions including Spain, the United Kingdom, Germany, Turkey and others. Meanwhile, strength in China and Japan have led to solid RevPAR growth in the Asia Pacific region as well.
Enhancing Customer Loyalty
The new hotels by Hampton also seem to be part of Hilton’s bid to enhance customer loyalty, more so because the brand is a component of Hilton Honors, one of the largest loyalty programs. With about 71 million members, this network has emerged as a highly valuable asset for the company. The company is focused on making multiple enhancements to its loyalty program in order to make it more customer centric, driving incremental value for guests and the overall system.
Zacks Rank & Stocks to Consider
Hilton carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the hotel space include Hilton Grand Vacations HGV, Marriott Vacations Worldwide VAC and Wyndham Worldwide WYN. While Hilton Grand Vacations and Marriott Vacations Worldwide sport a Zacks Rank #1 (Strong Buy), Wyndham carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Hilton Grand Vacations, Marriott Vacations Worldwide and Wyndham’s earnings for 2018 are expected to grow 43.7%, 20.1% and 30.4%, respectively.
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