Choice Hotels Forecasts Higher-Than-Expected Earnings
Skift Take
- Stock market indices showed positive movement, with the DJIA rising 317 points and the Nasdaq up 75 points, while lodging stocks mostly saw gains.
- IHG Hotels & Resorts clarified that it did not experience a demand reversal for leisure bookings, refuting an earlier misleading report.
- Choice Hotels issued a business update reaffirming full-year guidance, highlighting a drop in share repurchases and a higher-than-expected 2024 EBITDA projection, possibly indicating upcoming announcements or unique circumstances in the industry.
The DJIA rose 317 points while Nasdaq was up 75, the S&P 500 rose 30 points and the 10-year treasury yield was down .03 to 3.98%. Lodging stocks were mostly higher. VCSA was up 9% and AHT was up 5% to lead the gainers.
Choice Hotels issued a business update this morning, reaffirming full-year guidance and giving a 2024 EBITDA target that was above Street estimates. Analysts were a bit puzzled on the reasoning for doing this but perhaps we will find out shortly. Two things that stood out in the update. One was that quarter-to-quarter share repurchases dropped to $60 million in 2Q from $160 million in 1Q. The second was the higher-than-expected 2024 EBITDA projection although the 107 hotel openings year to date was not a number that anyone should gloss over. it had opened an average of more than four hotels a week in the first half of 2023 — a 39% jump year-over-year. As for why CHH did this, it could be an upcoming de
