Hilton Worldwide Holdings Inc. ($HLT: $142.00): Success Is Never Final, Failure Is Never Fatal Array ( [cookie] => 596a25-805399-724db3-06fc84-1cfaa6 [current_usage] => 2 [max_usage] => 2 [current_usage_crypto] => 2 [max_usage_crypto] => 2 [lock] => 1 [message] => [error] => [active_member] => 0 [subscriber] => 0 [role] => [visitor_id] => 208285 [user_id] => [reason] => [method] => ) 1 and can accesss
Key Takeaways
- Hilton World Wide Holdings has been a widely recognized Wall Street favorite because of its asset-light model, network effects/loyalty program, strong brand and geographic revenue mix. We think Wall Street is right in this case.
- The company does indeed trade at a premium compared to some peers, but we think the track record of a capable management, the return of pent-up demand to travel, and the return to 2019 levels (and probably beyond) for key metrics like RevPAR suggest this stock can still run.
- The postponing of travel because of a persistently adverse health situation around the Delta variant suggest a return to pre-crisis growth rates or beyond in EPS when demand booms. Hilton’s franchise fee structure is also more appealing than peers more dependent on management fees.
- Sometimes the market puts a valuation premium on companies with better prospects than its peers and we think that is the case here. Hilton’s fee based model mixed with a premier global brand, huge rewards program (125 million), and pent up demand should be quite lucrative.
- The article is titled based on a quote from company founder and namesake, Conrad Hilton. The survivability despite nearly zero revenue and ability to cut costs and continue growing available rooms faster than peers shows the second part of this quote was prescient.


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