JP Morgan Comments on Marriott's Mixed Results and Outlook

Marriott MAR reported 2Q11 EPS of $0.37, “in line with our/Street's estimate, though quality was mixed and, in all candor, there were many things to pick at,” JP Morgan reports. “2Q11 worldwide RevPAR growth of 7.7% was in line with our 7.8% estimate, but lodging fees of $319m were $10m below our estimate and below guidance of $320-$330m,” JP Morgan writes. “In addition, timeshare profits of $43m were $10m below our estimate and below guidance of $50 to $55m. G&A was $10m lower, somewhat offsetting these shortfalls, generating an operating profit result that was $10m below our estimate. Lower net interest expense, a slightly lower tax rate and a lower average share count offset the operating shortfall to produce an in-line EPS result.” Marriott closed Wednesday at $37.14.