Marriott International Inc.
), one of the world's largest lodging companies, has approved an
additional share repurchase, thereby maintaining the trend of
returning wealth to its shareholders from time to time, depending
on market conditions.
Under this program, this Maryland-based hotelier has raised its
authorization by another 25 million of its common stock leaving a
total 34 million shares available for repurchase. The company
repurchased 31.2 million shares for $1.2 billion in 2012.
Last week, one of Marriott's close peers
Starwood Hotels & Resorts Worldwide Inc.
) also increased its share repurchase authorization by $500
Million, taking the total amount available under the
authorization to about $680 million as of Feb 13, 2013.
The increase in share buyback authorization reflects the
company's confidence in its fundamentals. At the same time, the
share buyback activity will help the company reduce outstanding
share count, thereby increasing earnings per share and return on
equity. Apart from bolstering shareholder value, this strategic
move will also lift the relatively undervalued share price.
Apart from buyback, Marriott is also committed to a dividend
distribution program. Its last dividend hike came in May 2012
when the company hiked its quarterly dividend by 30% and aimed to
return $1.1 billion to shareholders in 2012, up from its previous
expectation of $1 billion. Marriott is expected to report its
fourth quarter 2012 earnings on Feb 19.
Marriott currently carries a Zacks Rank #3 (Hold). Some hotel
companies, which are expected to perform well, include
The Marcus Corporation
Intercontinental Hotels Group plc
) carrying a Zacks Rank #1 (Strong Buy).
STARWOOD HOTELS (HOT): Free Stock Analysis
INTERCONTL HTLS (IHG): Free Stock Analysis
MARRIOTT INTL-A (MAR): Free Stock Analysis
MARCUS CORP (MCS): Free Stock Analysis Report
To read this article on Zacks.com click here.