Choice Hotels (CHH) RevPAR Surges During Memorial Day Weekend
Choice Hotels International, Inc. CHH recently provided business update at the Goldman Sachs Travel and Leisure Conference. The company’s domestic operations performed exceptionally well during the Memorial Day weekend.
The company’s domestic systemwide revenue per available room (RevPAR) increased 12% for May 28 to 30, 2021, compared with the same Memorial Day weekend in 2019. This marks the strongest Memorial Day weekend performance in the history of the company. Moreover, May 29 witnessed the company’s highest single day revenue ever.
Choice Hotels continues to expect robust demand during the summer. It further informed that bookings for Independence Day weekend remain strong. Domestic systemwide RevPAR for Jun 4 to 5, 2021 jumped 18% compared with the same weekend following Memorial Day in 2019.
However, its RevPAR for May 2021, decreased nearly 4.2%, compared with May 2019. Meanwhile, the company announced that WoodSpring Suites witnessed RevPAR growth of more than 15% in the second quarter through May 31, 2021, compared with the same period of 2019.
The company’s domestic systemwide RevPAR during second-quarter through May 31, 2021 for its economy portfolio has surpassed 2019 levels. However, during the same period RevPAR for the company’s midscale portfolio reached pre-pandemic level.
Stock Performance
Shares of the company have gained 19.9% in the past six months, compared with the industry’s rally of 13.2%. The company is benefiting from expansion efforts. In 2020, it awarded 427 domestic franchise agreements, out of which 70% accounted for conversion hotels. During first-quarter 2021, the company executed 89 domestic franchise agreements, out of which more than 80% were for conversion hotels.
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Alongside domestic growth, Choice Hotels continues to expand its international footprint in new countries. Key international operating markets include Spain, Colombia, Panama, the Caribbean and Canada. Relatively new to the midscale portfolio, Clarion Pointe — part of the popular Clarion brand — is experiencing great success. Notably, Clarion Pointe brand is resonating well with guests. Currently, the brand has more than 20 hotels (in the pipeline). During the first quarter, the brand opened its 30th hotel in the United States.
Choice Hotels, which shares space with Hyatt Hotels Corporation H, Hilton Worldwide Holdings Inc. HLT and Extended Stay America, Inc. STAY, carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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