Why Is Hyatt Hotels Stock Sliding Today?

Hyatt Hotels Corporation H shares are trading lower after the company reported first-quarter adjusted EPS below street view.

The company reported first-quarter FY24 sales growth of 2% year-on-year to $1.714 billion, beating the analyst consensus estimate of $1.707 billion.

Comparable system-wide RevPAR increased 5.5% to $131.86. System-wide Net Rooms Growth was 5.5%. Comparable owned and leased hotels RevPAR increased 0.1% to $178.04.

Adjusted EBITDA fell 5.9% to $252 million from $268 million last year. Adjusted EPS of $0.71 missed the analyst consensus of $0.91.

Hyatt repurchased 528,427 million shares of Class A common stock for $76 million in the first quarter. The company held $794 million in cash and equivalents as of March-end. At the end of first-quarter, the company had a total debt of $3.05 billion.

The company’s board of directors has authorized the repurchase of up to an additional $1 billion of the company’s common stock. As of May 9, the company has approximately $1.8 billion remaining under the share repurchase authorization.

Outlook: Hyatt expects FY24 capital expenditure to be $170 million. The company currently expects to grow net rooms by 5.5% – 6%. It expects comparable system-wide hotels RevPAR to increase 3% to 5% on a constant currency basis.

The company’s full-year Adjusted EBITDA is projected between $1.15 billion and $1.19 billion and is in line with the previously provided outlook when adjusting for $30 million of reduced Adjusted EBITDA due to transactions.

Price Action: H shares are trading lower by 1.62% at $145.43 at the last check Thursday.

Photo via Wikimedia Commons