The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Carnival (NYSE: CCL) and the rest of the travel and vacation providers stocks fared in Q2.
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 18 travel and vacation providers stocks we track reported a mixed Q2. As a group, revenues beat analysts’ consensus estimates by 1.1% while next quarter’s revenue guidance was in line.
Thankfully, share prices of the companies have been resilient as they are up 6% on average since the latest earnings results.
Carnival (NYSE: CCL)
Boasting outrageous amenities like a planetarium on board its ships, Carnival (NYSE: CCL) is one of the world's largest leisure travel companies and a prominent player in the cruise industry.
Carnival reported revenues of $6.33 billion, up 9.5% year on year. This print exceeded analysts’ expectations by 1.7%. Overall, it was a very strong quarter for the company with a beat of analysts’ EPS estimates and a solid beat of analysts’ adjusted operating income estimates.
Interestingly, the stock is up 30.2% since reporting and currently trades at $31.29.
Is now the time to buy Carnival? Access our full analysis of the earnings results here, it’s free.
Best Q2: Pursuit (NYSE: PRSU)
With attractions ranging from glacier tours in the Canadian Rockies to an oceanfront geothermal lagoon in Iceland, Pursuit Attractions and Hospitality (NYSE: PRSU) operates iconic travel experiences, experiential marketing services, and exhibition management across North America and Europe.
Pursuit reported revenues of $116.7 million, down 69.2% year on year, outperforming analysts’ expectations by 6.9%. The business had a stunning quarter with a beat of analysts’ EPS estimates and full-year EBITDA guidance exceeding analysts’ expectations.
The market seems happy with the results as the stock is up 21.6% since reporting. It currently trades at $36.51.
Is now the time to buy Pursuit? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: Hilton Grand Vacations (NYSE: HGV)
Spun off from Hilton Worldwide in 2017, Hilton Grand Vacations (NYSE: HGV) is a global timeshare company that provides travel experiences for its customers through its timeshare resorts and club membership programs.
Hilton Grand Vacations reported revenues of $1.27 billion, up 2.5% year on year, falling short of analysts’ expectations by 8.1%. It was a disappointing quarter as it posted a significant miss of analysts’ adjusted operating income estimates and a significant miss of analysts’ EPS estimates.
Hilton Grand Vacations delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 9.9% since the results and currently trades at $45.77.
Read our full analysis of Hilton Grand Vacations’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 $6.74 billion, up 4.7% year on year. This number topped analysts’ expectations by 1.2%. Taking a step back, it was a mixed quarter as it also produced a decent beat of analysts’ EBITDA estimates but EBITDA guidance for next quarter missing analysts’ expectations.
The stock is up 3.7% since reporting and currently trades at $269.
Read our full, actionable report on Marriott here, it’s free.
Choice Hotels (NYSE: CHH)
With almost 100% of its properties under franchise agreements, Choice Hotels (NYSE: CHH) is a hotel franchisor known for its diverse brand portfolio including Comfort Inn, Quality Inn, and Clarion.
Choice Hotels reported revenues of $426.4 million, down 2% year on year. This print was in line with analysts’ expectations. Aside from that, it was a mixed quarter as it also logged full-year EBITDA guidance slightly topping analysts’ expectations but a miss of analysts’ adjusted operating income estimates.
The stock is down 4.6% since reporting and currently trades at $119.32.
Read our full, actionable report on Choice Hotels here, it’s free.
Market Update
The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.
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