Credit: Shutterstock photoAfter announcing the acquisition of Starwood Hotels & Resorts on Sep 23, Marriott International, Inc.MAR has become the world's largest hotel company, spanning across 120 countries with over 6,000 properties. Shares of the company have gained over 21% since the date, while Marriott's peer group dipped 7% in the same time frame, depicting the positive effect of the acquisition.
In addition to domestic markets, Marriott is consistently trying to expand its presence worldwide and capitalize on the demand for hotels in the international markets. In the last two days, the company announced the addition of three new hotels to its global portfolio.
Aloft Hotel
Firstly, the company announced its plan to launch the Aloft brand in Ireland through a franchise agreement with Blackpitts Hospitality Limited. Operated by Dublin-based Pembroke Hospitality Limited, the Aloft Dublin City is slated to open in the spring of 2018.
The hotel will encompass over 200 loft-style rooms, modern meeting spaces, a vibrant rooftop bar and lounge along with a 24-hour deli option, among other amenities. Moreover, the hotel will feature the industry's first keyless entry system, SPG Keyless that enables guests to use their smartphone or Apple watch as a room key.
The Aloft brand offers a tech-forward, lively experience to the next generation of tech-savvy travelers and now has over 100 hotels across 19 countries. Aloft Dublin City will complement Marriott's existing Irish portfolio, comprising four hotels operating under the Autograph Collection, Renaissance Hotels, Sheraton and Westin brands, respectively.
Ritz Carlton Hotel
Secondly, the company's Ritz Carlton subsidiary, announced the opening of its first golf resort in China, idyllically located in the golfer's paradise of Hainan Island. The 175-room and 16-suite hotel, The Ritz-Carlton, Haikou, is the ultimate destination for luxury and leisure travelers, boasting a variety of high-end amenities like ballrooms, a spa, pools, fine dining areas and the immersive Ritz Kids program. The hotel is situated on the world-class golf resort of Mission Hills, which boasts ten 18-hole championship courses designed by golf's greatest architects.
The Ritz-Carlton Hotel Company, L.L.C., currently operates more than 90 hotels in over 30 countries and territories as well as over 40 hotel and residential projects, under development around the globe.
W Hotel
Thirdly, Marriott inked an agreement with QPR Properties Kft, part of Constellation Hotels Holding Ltd., to debut the iconic W Hotels brand in Hungary. The W Budapest will be conveniently located on the city's most luxurious shopping street, directly across the State Opera House. The 162-room hotel will also include a restaurant and bar, meeting spaces, a spa, a fitness center and a pool.
W Hotels boasts a worldwide portfolio of 50 properties and is on track to reach 75 hotels by 2020. The signing of this hotel in Budapest follows the rising demand of luxury travel and underpins Marriott's commitment to grow in the European region.
Bottom Line
With the boost in the economy and an improvement in business and leisure travel, Marriott is well poised to grow in the near as well as long term, in major North American and international locations. Moreover, digital innovations and social media are starting to play an increasingly important role in bookings, by connecting directly with guests, which in turn can lead to increased loyalty and market share.
However, economic/political conditions are expected to remain challenging post-Brexit and this might limit Marriott's business growth, given its considerable presence in Europe. Significant currency headwinds are affecting most of the hoteliers across the world, including Hyatt Hotels Corporation H , Hilton Worldwide Holdings HLT , and Wyndham Worldwide Corporation WYN , are likely to impact Marriott's top line too.
Nevertheless, the company's full-year 2016 earnings estimates have moved north by 1.4% over the past two months, reflecting optimism in the stock's prospects. Thus, we believe that despite these headwinds, this Zacks Rank #2 (Buy) company is well poised to grow in the long term, given its solid positioning in the hotels space. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
