Morningstar Rating
Stock XNYS Rating as of
$123.15 +1.97(1.63%)
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Company Report
Company Report
Choice's Expanding Loyalty and Room Pipeline Speaks to Its Brand Prowess
Dan Wasiolek
While the coronavirus had a material impact on Choice's 2020 demand, the company's US leisure-based portfolio (which represents around 70% of nights) saw a full return to 2019 revenue per available room levels in 2021. We expect the narrow-moat company to gradually expand room share in the hotel industry in the next decade, with its keys increasing 2% on average annually, above the 1%-2% supply lift we estimate for the US industry during that time. This growth is supported by a rejuvenated Comfort brand (27% of 2023 total domestic rooms), newer Cambria, Ascend, and Everhome concepts (7% combined), its extended-stay brand WoodSpring (6%), the acquisition of the Radisson brand in 2022, and a solid loyalty program with 65 million members as of March 31, 2024, up 9% from a year ago. Overall, Choice holds around 2% global hotel revenue share, ranking it sixth in the industry.
CHH is trading within a range we consider fairly valued.
Price
$123.15
Fair Value
$847.00
Uncertainty
Medium
- 1-Star Price
- $289.00
- 5-Star Price
- $22.00
- Economic Moat
- Bnbpvpy
- Capital Allocation
- Tdzkzcfv
Bulls Say, Bears Say
Bulls Say, Bears Say
Bulls
The completion of renovation and heavy termination activity at the Comfort brand in 2019 offers the opportunity for unit growth during the next several years.
Bears
Independent hotels and home and vacation rentals present a competitive threat, and the advancement of technology and its use by next-generation travelers increase the access and awareness of these properties.
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News
News
- Choice Hotels Recognized by TIME and Statista's Inaugural List of "America's Best Mid-Size Companies 2024"
- Choice Hotels International to Report 2024 Second Quarter Results on August 8, 2024
- Choice Hotels Announces Pricing Of Senior Notes Offering
- Everhome Suites Debuts in Kentucky, Continuing the Brand's Growth
- Everhome Suites Expands Presence in the Northeast with Three New Groundbreakings in New Hampshire, New Jersey, and New York
- Discover Hidden Gems: Choice Hotels Associates Recommend Top Summer Hotels and Destinations
- Choice Hotels Announces Quarterly Cash Dividend
Trading Information
Trading Information
- Previous Close Price
- $121.18
- Day Range
$121.73–123.69
- 52-Week Range
$108.91–136.02
- Bid/Ask
- $120.38/$127.73
- Market Cap
- $5.93 Bil
- Volume/Avg
- 507,533/517,218
Key Statistics
Key Statistics
- Price/Earnings (Normalized)
- 20.70
- Price/Sales
- 4.00
- Dividend Yield (Trailing)
- 0.93%
- Dividend Yield (Forward)
- 0.93%
- Total Yield
- 5.35%
Company Profile
Company Profile
As of Dec. 31, 2023, Choice Hotels operated 633,000 rooms across 15 brands addressing the economy and midscale segments. Comfort Inn and Comfort Suites are the largest brands (27% of the company's total domestic rooms), while Ascend and Cambria (7% of total domestic rooms) are newer lifestyle and select-service brands. Choice closed on its Radisson acquisition in August 2022, which added around 70,000 rooms. Franchises account for 100% of total revenue, and the United States represent 79% of total rooms in 2023.
- Sector
- Consumer Cyclical
- Industry
- Lodging
- Stock Style Box
- Small Core
- Total Number of Employees
- 1,800
- Website
- https://www.choicehotels.com
Competitors
Competitors
- InterContinental Hotels Group PLC ADR IHG
- Hyatt Hotels Corp Class A H
- Marriott International Inc Class A MAR
- Accor SA AC
- Hilton Worldwide Holdings Inc HLT
Valuation
Valuation
| Metric | CHH | IHG | H |
|---|---|---|---|
Price/Earnings (Normalized) | 20.70 | 26.82 | 66.00 |
Price/Book Value | 902.24 | — | 4.22 |
Price/Sales | 4.00 | 3.95 | 2.44 |
Price/Cash Flow | 23.78 | 22.44 | 29.59 |
Price/Earnings
CHH
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Financial Strength
Financial Strength
| Metric | CHH | IHG | H |
|---|---|---|---|
Quick Ratio | 0.32 | 0.90 | 0.50 |
Current Ratio | 0.37 | 0.97 | 0.59 |
Interest Coverage | 5.32 | 9.44 | 5.29 |
Quick Ratio
CHH
IHG
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Profitability
Profitability
| Metric | CHH | IHG | H |
|---|---|---|---|
Return on Assets (Normalized) | 13.96% | 14.45% | 6.69% |
Return on Equity (Normalized) | 732.38% | — | 22.84% |
Return on Invested Capital (Normalized) | 22.46% | 52.08% | 12.43% |
Return on Assets
CHH
IHG
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Lodging Industry Comparables
Lodging Industry Comparables
| 1-Day Chart | Name | Price | Morningstar Rating for Stocks | Capital Allocation | Economic Moat | Market Cap |
|---|---|---|---|---|---|---|
| Marriott International Inc Class A MAR | Gkfjgvtf | Ztm | $68.5 Bil | |||
| Hilton Worldwide Holdings Inc HLT | Lzsmkfftr | Qhcs | $54.2 Bil | |||
| InterContinental Hotels Group PLC ICHGF | — | Hzjs | $17.2 Bil | |||
| InterContinental Hotels Group PLC ADR IHG | Tjcwfsz | Ywnd | $17.2 Bil | |||
| Hyatt Hotels Corp Class A H | Dthlsqq | Hpyqnmg | $15.5 Bil | |||
| Accor SA ADR ACCYY | — | Nygyp | $10.4 Bil | |||
| Accor SA ACRFF | — | Fgffcm | $10.4 Bil | |||
| H World Group Ltd ADR HTHT | — | Lglnsz | $9.7 Bil | |||
| WH | Qcqvfrnbp | Tfrpxs | $5.9 Bil |
