4. Marriott International, Inc. (NASDAQ:MAR)
Number of Hedge Fund Holders: 52
Marriott International, Inc. (NASDAQ:MAR) owns and runs hotels and resorts. On May 4, the company posted earnings for the first quarter of 2022, reporting earnings per share of $1.25, beating estimates by $0.33. Revenue over the period was $4.2 billion, up close to 81% compared to the revenue over the same period last year. During the first three months of 2022, the firm added 11,800 rooms globally. These included 5,300 rooms in international markets and more than 2,500 conversion rooms. The development pipeline totals almost 2,900 properties.
On May 4, Stifel analyst Simon Yarmak maintained a Hold rating on Marriott International, Inc. (NASDAQ:MAR) stock and raised the price target to $180 from $175, noting that the firm had a better line of sight into North American markets and recently reinstated dividends as well.
At the end of the first quarter of 2022, 52 hedge funds in the database of Insider Monkey held stakes worth $3.5 billion in Marriott International, Inc. (NASDAQ:MAR), up from 43 in the previous quarter worth $2.8 billion.
In its Q1 2022 investor letter, LRT Capital Management, an asset management firm, highlighted a few stocks and Marriott International, Inc. (NASDAQ:MAR) was one of them. Here is what the fund said:
“Marriott International, Inc. (NASDAQ:MAR) is the world’s largest hotel company followed closely by Hilton (HLT) and Intercontinental Hotels Group plc (IHG). The company owns a portfolio of brands from the low end (Courtyard, SpringHill Suites, Aloft), through the mid-tier (Marriott, Sheraton, Westin, Renaissance Hotels), to the luxury high end (JW Marriott, Ritz-Carlton, St. Regis). In total the company had 7,642 properties with over 1.4 million rooms as of the end of Q1 2021. The majority (85%) of Marriott’s revenue comes from hotels in the United States, with the rest almost evenly split between Asia Pacific and Europe. Like it’s smaller peer, Hilton, the company today is almost exclusively a manager and franchisor of hotels, not a hotel owner. Marriott International, Inc. (NASDAQ:MAR) owns 66 hotels, manages 2,083 and franchises 5,493. Like all franchise-based businesses Marriott requires very little capital to grow as it utilizes the investment capital of its hotel-owners/partners to expand. Marriott currently faces a difficult operating environment due to the Covid-19 pandemic and uncertainty about the future of business travel. However, the company is an excellent operator with a somewhat leveraged capital structure (the company acquired Starwood Properties in late 2016) – if pent-up demand for travel materializes post-Covid, as we expect it will, Marriott International, Inc. (NASDAQ:MAR) will quickly go from losing money to raking in profits.”
