Wyndham Hotels (WH) Expands U.K. Footprint With New Hotel
Wyndham Hotels & Resorts, Inc. WH recently announced collaboration with Roadchef for the opening of Super 8 hotel by Wyndham Chester East in the U.K. The company expects to open the property (post renovations) later this month, thereby marking the brand’s first property in the region.
The 41-room property comprises a mix of contemporary rooms to suit families, groups, couples or individuals. Also, it boasts modern amenities like in-room technology, bar and restaurant and on-site EV charging facilities, thereby providing an inclusive and affordable experience for guests seeking a reliable roadside companion. The property paves the path for access to nearby locations, including Cheshire, Greater Manchester and North Wales area.
The company is upbeat about the hotel opening and believes the initiative to advance the improvement and revolutionization of the roadside hotel experience.
Emphasis on Expansion
The company's primary growth strategy focuses on expansion through the establishment of new hotels. During first-quarter fiscal 2023, the company’s development pipeline increased 3% (sequentially) and 11% (year over year) to 1,800 hotels (or 226,000 rooms). During the quarter, the company awarded 123 new contracts for its legacy brands (reflecting a rise of 7% year-over-year), and 35 new contracts for ECHO Suites Extended Stay by Wyndham brand. The number of domestic contracts signed in the first quarter (excluding ECHO) increased 13% year over year, demonstrating that developers continue to favour new build prototype and conversion brands.
In the United States, the company expanded its portfolio by adding over 6,000 rooms through more than 40 new hotel conversions and five new construction projects. One notable addition is the La Quinta-Hawthorn Suites dual brand hotel in Sulphur, Louisiana, situated across from the West-Cal Arena. Internationally, the company opened over 4,000 rooms and achieved a 7% organic growth in net rooms compared with prior year’s levels. The Latin America team successfully secured impressive conversions from competitive brands, including the new Wyndham Garden Torreon in the thriving Mexican city and the La Quinta Quito, conveniently located near upscale stores and entertainment in Ecuador's capital city.
Moving ahead, the company anticipates starting construction on additional ECHO hotels in 2023, with the brand starting to significantly increase the number of rooms in 2024 and beyond. Backed by the strength and momentum of the demand in the extended stay sector, the company is upbeat about its expansion efforts and anticipates it to drive growth in the upcoming periods.
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In the past three months, shares of Wyndham Hotels have increased 7.8% compared with the industry’s 2.1% rise.
Zacks Rank & Key Picks
Wyndham Hotels currently carries a Zacks Rank #4 (Sell).
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Choice Hotels International, Inc. CHH carries a Zacks Rank #2. The company has a trailing four-quarter earnings surprise of 1.7%, on average. Shares of CHH have surged 7.9% in the past year.
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