Susquehanna starts hotels with Neutral view on ‘full’ valuations

As previously reported, Susquehanna analyst Christopher Stathoulopoulos initiated coverage of five hotel stocks, all with Neutral ratings, citing concerns that macro and geopolitical risks will limit growth into 2025. Lower and middle income consumers are increasingly more price sensitive and travel volumes are either at or nearing cycle peaks, contends the firm, which does not see “a scenario supporting meaningful seasonal outperformance into 2025.” Valuations for the “Big 3” hotel brands, or Marriott (MAR), Hilton (HLT) and Hyatt (H), are “already full,” while Choice Hotels (CHH) and Wyndham Hotels (WH), which are exposed to the economy-to-midscale markets, are “show me stories,” the analyst tells investors. Susquehanna set a $255 price target on Marriott, a $215 target on Hilton, a $160 price target on Hyatt, a $125 target on Choice and an $80 price target on Wyndham Hotels shares.