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Stay Put with These Lodging Stocks

Today I’m doing another vacation-themed blog. Yesterday, we talked about airline stocks, and today, I thought we’d take a look at hotels. After all, you have to stay somewhere once you get to your vacation destination.

I started by looking at what the Turner Analytics database had to say about hotels, and the first thing I noticed was that the entire Lodging Industry was hit hard in the market selloffs that started in 2016. In fact, the industry dipped below its trend line in early December, and though it’s rallied in the past month, it has yet to move back above its trend line.

I see similar dips in individual stocks, though there’s more of a variety of when the declines start and how sharply they decrease. One thing I do see across the board is that none of these companies have strong earnings or revenue growth—quarterly or yearly—which leads to lower fundamental scores.

Ticker Fundamental Score
(out of 100)
Technical Score
(out of 100)
Total Score
(out of 200)
Hilton Worldwide Holdings, Inc. (HLT) 47 95 142
Marriott International, Inc. (MAR) 57 28 85
Choice Hotels International, Inc. (CHH) 47 20 67
Starwood Hotels and Resorts Worldwide, Inc. (HOT) 24 28 52

Upon seeing the decline in hotel revenue, I would guess that most people think immediately of the competition hotels now have from room-sharing services like Airbnb. And it’s true that many people—especially millennials—are choosing Airbnb over traditional hotels. However, Hyatt President and CEO Mark Hoplamazian says that Airbnb hasn’t hurt their business, it’s just changed it. He told Yahoo Finance that Airbnb customers are looking for an authentic experience and that Hyatt has been changing its digital platforms and in-person experience as a result.

Still, it’s uncertain if this change will persuade customers to choose Hyatt over lower cost options. There’s also some uncertainty about what the pending Starwood-Marriott merger will mean for loyal Starwood customers. If they don’t like what they see with the new company, it’s hard to say what their chosen alternatives will be.

As you can see from the chart above, none of these hotels post especially remarkable scores in the Turner Analytics database, and with the amount of uncertainty in their futures, I recommend that you hold on these hotels for now.

To stay on top of my latest stock rankings, consider subscribing to my Turner Analytics database. If you would like a more managed portfolio of stocks, consider subscribing to Signal Investor. Or if you are looking for shorter-term trades, Perfect 10 Trader may be the right service for you.



Mike Turner 
Turner Trends

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