Marriott International (MAR) wins but delays the market: what you need to know – October 25, 2022
Marriott International (TUE – Free Report) closed the most recent trading day at $155.43, up +0.29% from the previous trading session. The stock lagged the S&P 500 daily gain of 1.63%. Meanwhile, the Dow Jones gained 1.07% and the tech-heavy Nasdaq gained 0.3%.
Prior to today’s session, the hotel company’s shares had gained 13.77% in the past month. This outpaced the Consumer Discretionary sector’s gain of 1.42% and the S&P 500’s gain of 2.94% during this period.
Investors are hoping for strength from Marriott International ahead of its next earnings release, which is expected on Nov. 3, 2022. The company is expected to post EPS of $1.69, up 70.71% from the quarter of the previous year. Meanwhile, Zacks consensus estimate for revenue calls for net sales of $5.27 billion, up 33.46% from the prior year period.
For the full year, our Zacks consensus estimates call for earnings of $6.51 per share and revenue of $20.34 billion, which would represent swings of +104.08% and +46, 78%, respectively, compared to the previous year.
It’s also important to note recent changes to analyst estimates for Marriott International. Recent revisions tend to reflect the latest short-term trading trends. Therefore, we can interpret positive estimate revisions as a good sign for the company’s business outlook.
Our research shows that these estimate changes are directly correlated to short-term stock prices. Investors can take advantage of this by using the Zacks ranking. This model accounts for these estimation changes and provides a simple and actionable scoring system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive track record of outperformance verified by external audits, with #1 stocks generating an average annual return of +25% since 1988 The Zacks Consensus EPS estimate rose 0.22% over the past month. Marriott International currently has a Zacks rank of #3 (Hold).
Digging into the valuation, Marriott International currently has a Forward P/E ratio of 23.82. This represents a premium to its industry average Forward P/E of 21.39.
Investors should also note that MAR has a PEG ratio of 0.6 at this time. This measure is used in the same way as the famous P/E ratio, but the PEG ratio also takes into account the growth rate of the stock’s expected earnings. Hotels and motels held an average PEG ratio of 0.66 at yesterday’s closing price.
The hotel and motel industry is part of the consumer discretionary sector. This group has a Zacks industry ranking of 74, which places it in the top 30% of over 250 industries.
The Zacks Industry Ranking assesses the strength of our individual industry groups by measuring the average Zacks Ranking of individual stocks within the groups. Our research shows that the top 50% of industries outperform the bottom half by a factor of 2 to 1.
Be sure to use Zacks.com to track all of these stock movement metrics, and more, in future trading sessions.