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Marriott (MAR) to Report Q1 Earnings: What's in the Cards?

·4 min read

Marriott International, Inc. MAR is scheduled to report first-quarter 2021 results on May 10, before the opening bell. In the last reported quarter, the company delivered an earnings surprise of 20%.

Trend in Estimate Revision

The Zacks Consensus Estimate for first-quarter bottom line is pegged at 3 cents per share, indicating a deterioration of 88.5% from 26 cents reported in the year-ago quarter.

For revenues, the consensus mark is pegged at nearly $2.5 billion that suggests a decline of 46.6% from the year-ago quarter’s reported figure.

Let's take a look at how things have shaped up in the quarter.

Marriott International, Inc. Price and EPS Surprise

Marriott International, Inc. Price and EPS Surprise
Marriott International, Inc. Price and EPS Surprise

Marriott International, Inc. price-eps-surprise | Marriott International, Inc. Quote

Factors to Note

Marriot’s first-quarter results are likely to have reflected dismal revenue per available room (RevPAR) and occupancy rates owing to the coronavirus pandemic. During fourth-quarter 2020, RevPAR for worldwide comparable system-wide properties fell 64.1% in constant dollars (down 63.9% in actual dollars) due to 35.6% and 27.4% decline in occupancy and average daily rate (ADR), respectively. Given a spike in COVID-19 cases along with reimposed travel restrictions, the dismal trend is likely to have persisted in the first quarter as well.

Moreover, the Zacks Consensus Estimate for first-quarter worldwide RevPAR suggests a decline of nearly 56% year over year. Comparable system-wide RevPAR in North America is estimated to witness a decline of nearly 73.4% year over year. Moreover, dismal RevPAR in Europe, Caribbean and Latin America, might get reflected in the to-be-reported quarter’s performance.

The first-quarter numbers are likely to reflect dismal base management and franchise revenues. The Zacks Consensus Estimate for revenues for base management and franchise is pegged at $100 million and $289 million, indicating a decline of 53.3% and 30.4% year over year, respectively.

However, resiliency in the China markets is likely to have driven the company in the to-be-reported quarter. This along with easing of travel restrictions and the pace of vaccine distributions are likely to have influenced the pace of recovery in the first quarter.

What the Zacks Model Unveils

Our proven model does not conclusively predict an earnings beat for Marriott 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. But that's not the case here.

Earnings ESP: Marriott has an Earnings ESP -37.93%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: The company has a Zacks Rank #4 (Sell).

Stocks With Favorable Combination

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

Fox Corporation FOXA has a Zacks Rank #1 and an Earnings ESP of +1.47%. 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%.

Accel Entertainment, Inc. ACELhas a Zacks Rank #3 and an Earnings ESP of +44.23%.

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Marriott International, Inc. (MAR) : Free Stock Analysis Report

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

Fox Corporation (FOXA) : Free Stock Analysis Report

Accel Entertainment, Inc. (ACEL) : Free Stock Analysis Report

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