Hyatt Earnings: Luxury, International, and Group Presence Drive Q1 Industry-Leading Demand

Narrow-moat Hyatt posted industry-leading revenue per available room, or revPAR, growth of 5.5% in its first quarter, which compared with the peer range of a drop of 5.9% at narrow-moat Choice to a 4% lift at wide-moat Marriott. In the period, Hyatt benefited from its exposure to luxury segments, which outperformed economy and midscale segments in the US, as well as its presence in international markets and group events, which we expect to remain growth drivers through 2024. Hyatt maintained its 2024 revPAR guidance of 3%-5%, and we don’t expect much change to our 5% estimate. We plan to increase our $138 fair value estimate by a mid-single-digit percentage, mostly due to the company’s equity stake from the February IPO of Juniper Hotels on the India stock exchange. We see shares as appropriately valued.