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Hyatt (H) Boosts Presence WIth Mr & Mrs Smith Platform Buyout

Hyatt Hotels Corporation H recently announced the acquisition of the asset-light Mr & Mrs Smith platform for an enterprise value of £53 million. The initiative paves the path for the strengthening of distribution capabilities, particularly across Europe.

Hyatt is invested in the strategies related to various acquisitions and divestitures that can drive growth. Case in point, the acquisition facilitates the addition of approximately 1500 hotels to its portfolio. With this transaction, H will unlock access to more than twice the number of global boutique and luxury properties within Hyatt direct booking channels.

The acquisition will extend Hyatt’s brand footprint into 20 new markets, including Fiji, Croatia, Iceland and Anguilla. Hyatt will work on expanded offerings and unique loyalty benefits for the combined companies' customer base.

Hyatt is continuously devising newer ways to enhance guest experience and raise occupancy. The company has a creative approach to food and beverage at its hotels worldwide and created profitable and popular venues that build and enhance demand for its hotel properties. Per the report, World of Hyatt members register 50% more stays in a year and 70% more spend per year with Hyatt compared with non-members.

The company is optimistic on exclusive franchise agreements with Lindner Hotels & Resorts and the World of Hyatt loyalty program, enabling members to earn and redeem points in 15 new destinations across Europe.

Price Performance

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Coming to price performance, shares of Hyatt have gained 19.3% in the past six months compared with the industry’s 6.3% growth. The company has been benefitting strong revenue recovery in China, relaxation of travel restrictions, high leisure and business demand, favorable pricing environment and elevated airlift activities. Also, solid ALG segment performance owing to strength in net package RevPAR, increased membership contracts for its Unlimited Vacation Club and favorable pricing added to the growth. Going forward, the company emphasizes on expansion initiatives and the extended-stay segment in the Americas to drive growth. Earnings estimates for 2023 have moved up in the past 30 days, depicting analysts’ optimism regarding the stock’s growth potential.

Zacks Rank & Key Picks

Hyatt Hotels currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the Zacks Consumer Discretionary sector are:

Royal Caribbean Cruises Ltd. RCL carries a Zacks Rank #1 (Strong Buy). RCL has a trailing four-quarter earnings surprise of 26.4%, on average. Shares of RCL have gained 51.8% in the past year. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for RCL’s 2023 sales and EPS indicates a rise of 48.5% and 162.8%, respectively, from the year-ago period’s levels.

Trip.com Group Limited TCOM carries a Zacks Rank #1. The company has a trailing four-quarter earnings surprise of 153.1%, on average. Shares of TCOM have increased 51.2% in the past year.

The Zacks Consensus Estimate for TCOM’s 2023 sales and EPS indicates a rise of 76.9% and 334.5%, respectively, from the year-ago period’s levels.

Skechers U.S.A., Inc. SKX carries a Zacks Rank #1. The company has a trailing four-quarter earnings surprise of 18.8%, on average. Shares of SKX have increased 26.2% in the past year.

The Zacks Consensus Estimate for SKX’s 2023 sales and EPS indicates a rise of 7.8% and 31.9%, respectively, from the year-ago period’s levels.

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