Hyatt (H) Plans to Expand Presence in Latin America & Caribbean

Hyatt Hotels Corporation H is looking to expand its presence in the Latin America and Caribbean regions. The company has a robust development pipeline of over 20 planned luxury and lifestyle hotels as well as resort openings through 2024 in those two regions.

Camilo Bolaños, senior vice president of development, Latin America & the Caribbean, Hyatt, said, “These exciting new hotels and resorts across Hyatt’s portfolio of upscale hotel brands reinforce our commitment to thoughtfully growing in key markets that matter to our guests, World of Hyatt loyalty members and customers.”

Hyatt is also trying to expand its presence worldwide and has expansion plans for Asia-Pacific, Europe, Africa, the Middle East and Latin America. Expansion in these markets should help the company gain market share in the hospitality industry, boosting its business.

Thus, an essential aspect of the company’s riveting growth potential is its strong brand presence and continual expansion in higher growth and under-penetrated markets such as India and China. Meanwhile, the company’s new signings across its brands globally have consistently outpaced openings.

Recently, Hyatt announced the opening of its luxury hotel, Thompson Madrid, in Spain, marking the first Thompson Hotels branded property in the region and the third Hyatt-branded hotel across Europe. The new hotel will join the likes of Hyatt Centric Gran Via Madrid and Hyatt Regency Hesperia Madrid.

During the second quarter of 2022, 28 new hotels (or 5,510 rooms) joined Hyatt's system. As of Jun 30, 2022, the company had executed management or franchise contracts for approximately 550 hotels (or 113,000 rooms). Unit growth in 2022 is expected to increase at approximately 6% on a net-room basis. In 2018, 2019 and 2020, Hyatt registered net room growth of 13.6%, 7.4% and 5.2%, respectively, on a year-over-year basis.

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Price Performance

The company’s shares have gained 10.7% in the past year against the industry’s decline of 7.5%. It is benefitting from solid leisure transient demand, the integration of Apple Leisure Group and asset disposition commitment. Also, sequential improvements in group travel and business transient demand bode well.

As people return to offices, travel restrictions are eased and more cross-border travel resumes, the company remains optimistic about the recovery of business transient and its continued momentum over the back half of the year. This and the strength in short-term bookings, coupled with strong food and beverage spending, are likely to support the company’s performance in the upcoming periods.

Zacks Rank & Other Key Picks

Hyatt currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some other top-ranked stocks in the Zacks Consumer Discretionary sector are Marriott Vacations Worldwide Corporation VAC, Playa Hotels & Resorts N.V. PLYA and InterContinental Hotels Group PLC IHG.

Marriott Vacations currently sports a Zacks Rank #1. VAC has a trailing four-quarter earnings surprise of 13.9%, on average. The stock has declined 8.5% in the past year.

The Zacks Consensus Estimate for VAC’s current financial year sales and earnings per share (EPS) indicates an increase of 19.7% and 131.4%, respectively, from the year-ago period’s reported levels.

Playa Hotels & Resorts carries a Zacks Rank #2. PLYA has a trailing four-quarter negative earnings surprise of 8.8%, on average. The stock has declined 12.5% in the past year.

The Zacks Consensus Estimate for PLYA’s current financial year EPS indicates growth of 206.3% from the year-ago period’s reported levels.

InterContinental Hotels carries a Zacks Rank #2. IHG has a long-term earnings growth of 32.7%. The stock has declined 17.7% in the past year.

The Zacks Consensus Estimate for IHG’s current financial year sales and EPS indicates growth of 21.7% and 88.4%, respectively, from the year-ago period’s reported levels.

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