-- CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:
HLT posted Q1 adj. EPS of $2.01 (+16.8% Y/Y), beating the $1.97 consensus, while total revenue of $2.94B (+9.0% Y/Y) was in line with estimates. Revenue per available room (RevPAR) growth accelerated 110 bps to +3.6%, led by occupancy gains (+140 bps to 67.4%) and average daily rate increases (+1.5% Y/Y), with broad-based strength across regions led by Europe (+6.9%) and Asia Pacific (+4.7%). Development momentum remained robust with 26,200 new rooms approved and the launch of Select by Hilton expanding into 26 new countries, positioning HLT well for continued growth. Despite raising systemwide RevPAR guidance to 2%-3% from 1%-2%, Q2 adj. EBITDA guidance ($1,015M-$1,035M) disappointed vs. the $1,081M consensus. We view the profit guidance as disappointing given the raised RevPAR outlook, suggesting consensus estimates could be too high. In our view, while strong demand trends and World Cup benefits could drive RevPAR outperformance, the guidance disconnect raises concerns about margin expansion potential.