Hilton’s premarket stock dips as 2024 guidance misses estimates

Hilton Worldwide Holdings Inc. saw its stock dip by 0.8% early Wednesday, after revealing its 2024 guidance that missed estimates, somewhat overshadowing a fourth-quarter profit beat.

The company posted a net income of $148 million, or 57 cents per share, for the quarter, down from $328 million, or $1.21 per share, in the same period the previous year.

Adjusted earnings per share were $1.68, exceeding the $1.57 FactSet consensus.

Revenue grew to $2.609 billion from $2.444 billion a year ago, in line with the FactSet consensus.

Systemwide revenue per available room rose notably by 5.7% on a currency-neutral basis and significantly by 13.5% compared to the same period in 2019, before the COVID-19 pandemic.

Hilton’s CEO, Christopher J. Nassetta, emphasized the positive momentum in hotel openings throughout the year, noting that the fourth quarter saw more openings than any other quarter in the company’s history.

Hilton 2024 shares
Hilton Worldwide Holdings Inc. saw its stock dip by 0.8% (Credits: Google Finance)

Looking forward to 2024, Hilton expects systemwide revenue per available room to increase between 2% and 4% on a currency-neutral basis.

The company forecasts earnings per share (EPS) to range from $6.57 to $6.71, with adjusted EPS projected between $6.80 and $6.94. However, these projections fall short of the FactSet consensus, which is $7.05 for EPS.

For the first quarter of the year, Hilton anticipates adjusted EPS to be in the range of $1.36 to $1.44, slightly below the FactSet expectation of $1.42.

Regarding its financial performance, Hilton unveiled a strategic partnership with Small Luxury Hotels of the World, a consortium of 560 luxury boutique hotels across 90 countries.

Through this collaboration, Hilton guests can now book stays at these hotels and earn or redeem points for their stays.

Hilton described the partnership as a means to complement its expansive network, offering guests access to more luxury accommodations in various new destinations.

Net income drops to $148 million in Q4 (Credits: Shutterstock)

This initiative reflects Hilton’s dedication to enriching its offerings and broadening its presence in the fiercely competitive hospitality sector.

Despite the recent stock decline, Hilton has seen a remarkable 31.3% gain in the past year, surpassing the S&P 500’s 19% increase during the same period.

The company’s strong financial performance and strategic partnerships bolster its upward trend, solidifying its status as a significant player in the ever-changing hospitality industry.

Investors are expected to closely observe how Hilton addresses the variance between its 2024 guidance and market projections, as well as the reception and impact of its newly unveiled partnership with Small Luxury Hotels of the World on customer engagement and the company’s market positioning.

Sajda Parveen
Sajda Parveen
Sajda Praveen is a market expert. She has over 6 years of experience in the field and she shares her expertise with readers. You can reach out to her at [email protected]
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