Benchmark Co. analyst Fawne Jiang maintained a Buy rating on H World Group (HTHT – Research Report) yesterday and set a price target of $48.00.
Fawne Jiang has given his Buy rating due to a combination of factors that highlight H World Group’s strong financial performance and strategic initiatives. The company reported better-than-expected fourth-quarter results, driven by a decrease in revenue per available room (RevPAR) pressure and a robust demand for leisure travel. Despite some initial concerns about revenue growth for the fiscal year 2025, the transition to an asset-light model is expected to enhance operating leverage, which is reflected in the increased adjusted EBITDA estimates.
Moreover, the company’s focus on expanding its high-quality hotel network and its strategic shift towards an asset-light model are key drivers for future growth. The expansion plan includes a significant number of new hotel openings, particularly in the upper-midscale segment and lower-tier cities, which supports rapid network growth with minimal capital investment. This approach, combined with efforts to enhance direct sales, positions H World Group for sustained margin improvements and earnings growth, justifying the Buy rating.
In another report released today, Bank of America Securities also reiterated a Buy rating on the stock with a $47.00 price target.
HTHT’s price has also changed moderately for the past six months – from $29.810 to $37.710, which is a 26.50% increase.