Summary
- Marriott International, Inc. continues to rebound with solid revenue growth and margin expansion.
- Its sound fundamentals and the business and leisure travel recovery provide more tailwinds.
- It must watch out for recessionary headwinds despite the still unperturbed travel plans.
- Dividends remain consistent and well-covered, but the yield is low.
- The stock price has been moving sideways following its recent dip and rebound.
Marriott International, Inc. (NASDAQ:MAR) continues demonstrating its resilience with its outstanding performance this quarter. Its operations remain unfazed despite the risks of inflation. Its efficiency and increased business and leisure travel drive its solid recovery. Yet, it must not be complacent since recessionary headwinds may hamper its rebound. Nevertheless, its solid fundamentals remain its cornerstone in a stormy market. Cash inflows stay high and stable enough to cover borrowings and dividends. However, its stock price does not reflect recessionary risks and appears overvalued.
Company Performance
Marriott International, Inc. felt the pandemic’s impact despite being an industry giant. Restrictions led to a sharp plunge in its financials. Yet, Marriott proved to be a resilient company as it rebounded. Its recovery started in the latter part of 2020 and persisted in the following quarters. With its prudent asset management and revenge travel, the upsurge has been evident this year.
This quarter, the operating revenue amounts to $5.31 billion, an 34% year-over-year growth. It is evident across all its business segments, showing absolute recovery. It is an outstanding quarter as the recent revenue is one of the record highs in history. Its global RevPAR is 36.3%, higher than in the comparative quarter. Even better, it has already exceeded pre-pandemic levels by 2-4%. Its impeccable rebound across all markets is visible despite inflationary headwinds.
