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 Hilton Grand Vacations (NYSE:HGV) and the rest of the travel and vacation providers stocks fared in Q3.
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 16 travel and vacation providers stocks we track reported a satisfactory Q3. As a group, revenues beat analysts’ consensus estimates by 0.8% while next quarter’s revenue guidance was 0.9% below.
Luckily, travel and vacation providers stocks have performed well with share prices up 10.9% on average since the latest earnings results.
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 $1.31 billion, up 28.3% year on year. This print exceeded analysts’ expectations by 0.9%. Despite the top-line beat, it was still a mixed quarter for the company with a decent beat of analysts’ EBITDA estimates but a miss of analysts’ adjusted operating income estimates.
“We’re pleased with our third quarter results, which were in line with our expectations,” said Mark Wang, CEO of Hilton Grand Vacations.
Hilton Grand Vacations pulled off the fastest revenue growth of the whole group. Unsurprisingly, the stock is up 1.5% since reporting and currently trades at $40.78.
Is now the time to buy Hilton Grand Vacations? Access our full analysis of the earnings results here, it’s free.
Best Q3: Playa Hotels & Resorts (NASDAQ:PLYA)
Sporting a roster of beachfront properties, Playa Hotels & Resorts (NASDAQ:PLYA) is an owner, operator, and developer of all-inclusive resorts in prime vacation destinations.
Playa Hotels & Resorts reported revenues of $183.5 million, down 13.9% year on year, outperforming analysts’ expectations by 4.1%. The business had a stunning quarter with a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates.
The market seems happy with the results as the stock is up 5.5% since reporting. It currently trades at $9.51.
Is now the time to buy Playa Hotels & Resorts? Access our full analysis of the earnings results here, it’s free.
Weakest Q3: Sabre (NASDAQ:SABR)
Originally a division of American Airlines, Sabre (NASDAQ:SABR) is a technology provider for the global travel and tourism industry.
Sabre reported revenues of $764.7 million, up 3.3% year on year, falling short of analysts’ expectations by 1.4%. It was a slower quarter as it posted a significant miss of analysts’ EPS estimates and a miss of analysts’ airline bookings estimates.
Sabre delivered the weakest full-year guidance update in the group. As expected, the stock is down 12.4% since the results and currently trades at $3.61.
Read our full analysis of Sabre’s results here.
Target Hospitality (NASDAQ:TH)
Essentially a builder of mini communities, Target Hospitality (NASDAQ:TH) is a provider of specialty workforce lodging accommodations and services.
Target Hospitality reported revenues of $95.19 million, down 34.8% year on year. This print surpassed analysts’ expectations by 8.3%. It was a very strong quarter as it also produced an impressive beat of analysts’ EPS estimates and a solid beat of analysts’ adjusted operating income estimates.
Target Hospitality delivered the biggest analyst estimates beat and highest full-year guidance raise, but had the slowest revenue growth among its peers. The stock is down 7.7% since reporting and currently trades at $8.49.
Read our full, actionable report on Target Hospitality here, it’s free.
Lindblad Expeditions (NASDAQ:LIND)
Founded by explorer Sven-Olof Lindblad in 1979, Lindblad Expeditions (NASDAQ:LIND) offers cruising experiences to remote destinations in partnership with National Geographic.
Lindblad Expeditions reported revenues of $206 million, up 17.1% year on year. This result surpassed analysts’ expectations by 6.3%. Overall, it was a strong quarter as it also recorded an impressive beat of analysts’ EPS estimates and full-year EBITDA guidance topping analysts’ expectations.
The stock is up 37.7% since reporting and currently trades at $12.87.
Read our full, actionable report on Lindblad Expeditions here, it’s free.
Market Update
As a result of the Fed's rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed's 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump's victory in the US Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain. Said differently, there's still much uncertainty around 2025.
Want to invest in winners with rock-solid fundamentals? Check out our Hidden Gem Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
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