As the Q3 earnings season wraps, let’s dig into this quarter’s best and worst performers in the travel and vacation providers industry, including Playa Hotels & Resorts (NASDAQ:PLYA) and its peers.
Airlines, hotels, resorts, and cruise line companies often sell experiences rather than tangible products, and in the last decade-plus, consumers have slowly shifted from buying "things" (wasteful) to buying "experiences" (memorable). In addition, the internet has introduced new ways of approaching leisure and lodging such as booking homes and longer-term accommodations. Traditional airlines, hotel, resorts, and cruise line companies must innovate to stay relevant in a market rife with innovation.
The 16 travel and vacation providers stocks we track reported a satisfactory Q3. As a group, revenues beat analysts’ consensus estimates by 0.8% while next quarter’s revenue guidance was 0.9% below.
Luckily, travel and vacation providers stocks have performed well with share prices up 11% on average since the latest earnings results.
Best Q3: Playa Hotels & Resorts (NASDAQ:PLYA)
Sporting a roster of beachfront properties, Playa Hotels & Resorts (NASDAQ:PLYA) is an owner, operator, and developer of all-inclusive resorts in prime vacation destinations.
Playa Hotels & Resorts reported revenues of $183.5 million, down 13.9% year on year. This print exceeded analysts’ expectations by 4.1%. Overall, it was a stunning quarter for the company with a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates.
Interestingly, the stock is up 6% since reporting and currently trades at $9.55.
Is now the time to buy Playa Hotels & Resorts? Access our full analysis of the earnings results here, it’s free.
Target Hospitality (NASDAQ:TH)
Essentially a builder of mini communities, Target Hospitality (NASDAQ:TH) is a provider of specialty workforce lodging accommodations and services.
Target Hospitality reported revenues of $95.19 million, down 34.8% year on year, outperforming analysts’ expectations by 8.3%. The business had a very strong quarter with an impressive beat of analysts’ EPS and adjusted operating income estimates.
Target Hospitality achieved the biggest analyst estimates beat and highest full-year guidance raise among its peers. Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 6.6% since reporting. It currently trades at $8.59.
Is now the time to buy Target Hospitality? Access our full analysis of the earnings results here, it’s free.
Weakest Q3: Sabre (NASDAQ:SABR)
Originally a division of American Airlines, Sabre (NASDAQ:SABR) is a technology provider for the global travel and tourism industry.
Sabre reported revenues of $764.7 million, up 3.3% year on year, falling short of analysts’ expectations by 1.4%. It was a slower quarter as it posted a significant miss of analysts’ EPS and airline bookings estimates.
Sabre delivered the weakest full-year guidance update in the group. As expected, the stock is down 10.2% since the results and currently trades at $3.70.
Read our full analysis of Sabre’s results here.
Marriott (NASDAQ:MAR)
Founded by J. Willard Marriott in 1927, Marriott International (NASDAQ:MAR) is a global hospitality company with a portfolio of over 7,000 properties and 30 brands, spanning 130+ countries and territories.
Marriott reported revenues of $6.26 billion, up 5.5% year on year. This number was in line with analysts’ expectations. Aside from that, it was a slower quarter as it recorded a miss of analysts’ EPS estimates and EBITDA guidance for next quarter missing analysts’ expectations.
The stock is up 7.4% since reporting and currently trades at $280.
Read our full, actionable report on Marriott here, it’s free.
American Airlines (NASDAQ:AAL)
One of the ‘Big Four’ airlines in the US, American Airlines (NASDAQ:AAL) is a major global air carrier that serves both business and leisure travelers through its domestic and international flights.
American Airlines reported revenues of $13.65 billion, up 1.2% year on year. This number beat analysts’ expectations by 0.5%. Overall, it was a very strong quarter as it also put up a solid beat of analysts’ EPS estimates and full-year EPS guidance exceeding analysts’ expectations.
The stock is up 9.7% since reporting and currently trades at $14.10.
Read our full, actionable report on American Airlines here, it’s free.
Market Update
Thanks to the Fed's series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market has thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.
Want to invest in winners with rock-solid fundamentals? Check out our Top 6 Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
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