Back to top

Image: Bigstock

Hyatt Expands Select Service Pipeline by 25% in Three Years

Read MoreHide Full Article

Hyatt Hotels Corporation (H - Free Report) continues to make remarkable strides in its select service segment, with 25% pipeline growth in the Americas over the past three years. As of June 30, 2024, this segment now represents more than half of Hyatt's total pipeline in the region, driven by its strategic focus on expanding lifestyle, luxury and all-inclusive properties.

Select service brands have been essential in promoting Hyatt’s World of Hyatt loyalty program, which has shown robust growth compared with its competitors. This surge in pipeline reflects Hyatt’s commitment to enhancing profitability through operational innovation.

Hyatt’s key select service brands are undergoing transformations to attract new market opportunities. The Caption by Hyatt brand has been reimagined with owner-driven feedback, offering a more cost-efficient and flexible design model. This new approach emphasizes market adaptability, reduced construction costs and an efficient food and beverage concept. These changes allow the brand to maintain its signature vibrant, neighborhood feel while appealing to a wider range of markets and driving expansion in the United States and abroad.

The rapid expansion of the Hyatt Studios brand is another major growth driver. In just 18 months, Hyatt Studios has secured more than 4,000 pipeline rooms and 250 deals in various stages of negotiation.

With its strategic focus on innovation, market adaptability and strong pipeline growth, Hyatt is well-positioned for long-term success in the highly competitive hospitality industry.

H Stock’s Price Performance and Zacks Rank

Shares of Hyatt have gained 17.9% so far this year, in line with the industry’s growth. The company has been benefiting from a gradual increase in demand, new hotel openings and acquisition initiatives.

Also, organic and inorganic growth initiatives, loyalty programs and asset-light business model bode well. Hyatt anticipates system-wide 2024 RevPAR to increase in the range of 3% and 4% year over year. Much optimism prevails on account of group bookings and confidence in the ongoing recovery of business transient demand, as well as the steady levels of leisure transient demand.

Zacks Investment Research
Image Source: Zacks Investment Research

H currently has a Zacks Rank #3 (Hold).

Key Picks

Some better-ranked stocks in the Zacks Consumer Discretionary sector are Norwegian Cruise Line Holdings Ltd. (NCLH - Free Report) , DoubleDown Interactive Co., Ltd. (DDI - Free Report) and Carnival Corporation & plc (CCL - Free Report) , each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Norwegian Cruise Line has a trailing four-quarter earnings surprise of 5.7%, on average. The stock has rallied 22.4% in the past year. The Zacks Consensus Estimate for NCLH’s 2024 sales and earnings per share (EPS) calls for growth of 9.9% and 127.1%, respectively, from the year-ago levels.

DoubleDown Interactive has a trailing four-quarter earnings surprise of 22.1%, on average. The stock has surged 85.9% in the past year. The Zacks Consensus Estimate for DDI’s 2024 sales and EPS indicates an increase of 12.6% and 15.8%, respectively, from the year-ago levels.

Carnival has a trailing four-quarter earnings surprise of 318.1%, on average. The stock has increased 42% in the past year. The Zacks Consensus Estimate for CCL’s 2025 sales and EPS indicates an increase of 3.6% and 26%, respectively, from the year-ago levels.

Published in