What’s Next For Hyatt Stock?
Hyatt Hotels Corporation stock (NYSE: H) has gained close to 19% since the beginning of 2024, compared to a 22% return of the S&P 500 over the same period. In comparison, its peer Marriott International (NASDAQ:MAR) stock is up about 24% over the same period. So what is happening with Hyatt Stock?
Hyatt’s Q3 2024 performance reflected mixed signals for the hospitality industry. Its total revenues remained flat year-over-year (y-o-y) at $1.6 billion in Q3 2024, with comparable system-wide all-inclusive resorts experiencing a 0.9% decline in Net Package revenue per available room (RevPAR). While the company reported a 3% year-over-year (y-o-y) increase in comparable system-wide RevPAR, this growth rate decelerated compared to the previous quarters. The company’s comparable system-wide RevPAR grew 4.7% y-o-y in Q2 2024 and 5.5% y-o-y growth in Q1 2024. Despite regional challenges, particularly in Greater China, Hyatt’s European operations drove growth in Q3. The company also achieved net room growth of 4.3% during the quarter. Looking ahead, Hyatt forecasts continued growth, with projected RevPAR increases of 3.0% to 4.0% and net room growth of 7.75% to 8.25% for FY 2024. In addition, the company’s adjusted EBITDA is expected to land in a range of $1.10 billion to 1.12 billion in FY 2024 compared to $1.03 billion in FY 2023. Separately, if you want upside with a smoother ride than an individual stock, consider the High Quality portfolio, which has outperformed the S&P, and clocked >91% returns since inception.
Hyatt’s business model is centered on fee-based revenue, licensing, and services, leveraging its brand and intellectual property through partnerships with third-party owners and franchisees. The company’s growth strategy is yielding results, with 16 new hotels and 2,589 rooms added in Q3 2024. Hyatt’s pipeline has expanded 10% y-o-y to 135K rooms, positioning the company for continued growth. In line with its strategic objectives, Hyatt expects fee-based revenues to drive earnings, targeting over 80% of earnings from fees by 2025. For FY 2024, the company forecasts fee-based revenues of $1.085 billion to $1.11 billion, representing a 13% increase at the midpoint.
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Hyatt has been actively pursuing strategic deals to accelerate growth, expand its luxury offerings, and transition toward an asset-light business model. Recent notable transactions include acquiring the Mr & Mrs Smith booking platform, Apple Leisure Group, and a deal to acquire 51 Standard International properties and pipeline projects for $335 million. Conversely, Hyatt has also been divesting owned properties, such as the $1 billion sale of the Hyatt Regency Orlando, while retaining long-term management agreements. This capital allocation strategy enables Hyatt to redeploy funds into asset-light platforms, reducing risk and increasing returns. These moves align with Hyatt’s growth strategy, which focuses on globalization, asset-light expansion, and enhanced customer engagement through its World of Hyatt loyalty program. With 51 million members, a 22% y-o-y increase, Hyatt is well-positioned to drive growth through managed and franchised properties.
It is helpful to see how its peers stack up. Check out how Hyatt’s Peers fare on metrics that matter. You will find other valuable comparisons for companies across industries at Peer Comparisons.
| Returns | Jan 2025 MTD [1] |
Since start of 2024 [1] |
2017-25 Total [2] |
| H Return | -2% | 19% | 187% |
| S&P 500 Return | -1% | 22% | 161% |
| Trefis Reinforced Value Portfolio | 1% | 17% | 758% |
[1] Returns as of 1/15/2025
[2] Cumulative total returns since the end of 2016
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