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Marriott International Inc (NASDAQ:MAR) was cut to In-Line from Outperform with a $180 price target by Evercore ISI analysts in a note Wednesday following the hotel operator’s latest earnings release.
“MAR reported solid 4Q adj. EPS of $1.96 (+25% y/3y), 7% ahead of our estimate, and guided ’23 EPS range ~ in-line with consensus at midpoint,” acknowledged the analysts.
However, with the stock having run through the firm’s $180 price target, they are moving to the sidelines.
“Net revenue (excluding cost reimbursement) was 5% ahead of our estimate driven by owned & leased segment and stronger incentive management fees,” the analysts added. “Adjusted EBITDA exceeded our estimate by 6%. MAR repurchased 8.7 million shares for $1.4b in 4Q (16.8m for $2.6b in’ 22). Net debt increased from $8.7b in 4Q21 to $9.6b in 4Q22.”
Assessing Marriott’s near-term demand outlook, they said that thus far, in the first quarter, demand has sustained across all customer segments and geographies.
“Leisure demand is still strong, particularly cross-border. Group revenues are pacing +20% y/y, noting growth through each quarter, and ’24 group pace is +5% ahead y/y. While Greater China is the only region with RevPAR still below ’19, MAR notes optimism in the recovery,” they added.
