Hyatt Has Positive Transformations Rolling-On, Says Analyst

Truist Securities analyst Patrick Scholes reiterated a Buy rating on the shares of Hyatt Hotels Corporation H and raised the price target from $132 to $145.
Hyatt is indeed a very different company today, even from five years ago and since the most recent investor day in March 2019, said the analyst.
Among the developments, $3.8 billion of owned asset sales at an implied >16x multiple, $3.6 billion of acquisitions (Miraval/Two Roads/Apple Leisure Group) at a 8x multiple, geographic and customer diversification, and a far more asset-light company, the analyst remarked.
Also Read: Hyatt Hotels Says Optimistic About The Year Ahead Post Solid Q4 Results
Importantly, the asset-lite transformation is not complete as approximately $1.3 billion of current owned asset dispositions remain to be completed by 2024 end, further transforming the company and reducing the complexity of modeling/analyzing/valuing, said the analyst.
The analyst anticipates further elaboration of the evolution of the company during the May investor day, possibly including a multi-year outlook.
Part of the upside potential may come from acquisition-related synergies, whether taking core competencies to the legacy portfolio or removal of duplicitous G&A, the analyst added.
While the analyst would prefer scenario guidance at Investor Day, the analyst anticipates Hyatt has tools in the toolbox to provide, at minimum, an Economic EBITDA range for 2024-2025.
Following 4Q results, the analyst’s 2023 Adjusted EBITDA projection goes to $1.206 billion from $1.157 billion and EPS to $2.87 from $2.84.
Also Read: Hyatt Regency Brand Enters One Of The Oldest Mediterranean Cities
Price Action: H shares are trading lower by 0.46% at $113.22 on the last check Tuesday.

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