Good news for Marriott International (NASDAQ:MAR) investors: Marriott is up in Tuesday afternoon trading thanks to a combination of factors. A positive earnings report dovetailed nicely to an improving trend that’s letting hotels make a comeback. Better yet, the trends that might have undercut hotels—and hotel stocks—aren’t having much negative impact at all.
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Marriott delivered a winner in its earnings report. It posted $1.96 per share in adjusted earnings, where consensus called for just $1.83. Revenue also proved a substantial beat, with Marriott bringing in $5.92 billion against consensus expectations of just $5.38 billion. Further, Marriott’s recovery worldwide was substantial, as bookings were up, and everywhere except China had “fully recovered” from pandemic-related losses in traffic.
Here’s where things get particularly interesting. We’ve all seen the impact the macroeconomic situation has had on a range of companies. Layoffs in the tech sector are already massive and getting worse. But that’s not hitting hotels at all. So far, bookings for 2023 look about as strong as they did in 2022. So despite a worsening macroeconomic picture and mounting layoffs, hotels—which should be the first to react to such conditions—aren’t having a problem. Reports note the trends remain under close observation, especially given that the average booking window runs about three weeks out. But currently, any problems are keeping their heads down.
Wall Street, however, remains skeptical. Current analyst consensus calls MAR stock a Hold. Further, with an average price target of $180.67 per share, it has just 0.94% upside potential.
