Earnings Results: Hilton stock climbs toward 9-month high as leisure and business RevPAR exceed pre-pandemic levels

by | Feb 9, 2023 | Stock Market

Shares of Hilton Worldwide Holdings Inc.
hiked up toward a nine-month high Thursday, after the hotel operator reported fourth-quarter profit that more than doubled and beat expectations, amid continued strength in leisure and a steady recovery in business travel. “We’ve navigated through the most challenging times our industry has experienced and are deep into recovery throughout the world,” said Chief Executive Chris Nassetta on the post-earnings conference call with analysts, according to a FactSet transcript.

He said revenue per available room, or RevPAR, for leisure, business transient and group guest segments all exceeded levels seen in 2019, as higher pricing helped offset occupancy that at 67% was just three percentage points below the below the pre-pandemic peak. The stock
rallied 2.9% in midday trading, to put it on track for the highest close since May 2, 2022. It has run up 16.6% over the past three months, while the S&P 500 index
has advanced 10.2%. The company reported before Thursday open net income that rose to $332 million, or $1.21 a share, from $147 million, or 52 cents a share, in the same period a year ago. Excluding nonrecurring items, adjusted earnings per share increased to $1.59 from 72 cents, to beat the FactSet consensus of $1.22. Revenue grew 33.1% to $2.44 billion, above the FactSet consensus of $2.35 billion. RevPAR increased 24.8% from last year, as occupancy improved 10.3 percentage points to 67.5% and the average daily rate (ADR) improved 20.6%. For the first quarter, the company expects adjusted EPS of between $1.08 and $1.14, compared with the FactSet consensus of $1.14. And for 2023, the expects adjusted EPS of between $5.42 and $5.68, which surrounds the current FactSet consensus of $5.59. RevPAR is expected to grow between 4% and 8%, while the FactSet RevPAR consensus of $105.60 implies 3.6% growth.

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