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Brokers Are Upgrading Their Views On Hyatt Hotels Corporation (NYSE:H) With These New Forecasts

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Shareholders in Hyatt Hotels Corporation (NYSE:H) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. Consensus estimates suggest investors could expect greatly increased statutory revenues and earnings per share, with the analysts modelling a real improvement in business performance.

Following the upgrade, the current consensus from Hyatt Hotels' 16 analysts is for revenues of US$5.7b in 2022 which - if met - would reflect a substantial 88% increase on its sales over the past 12 months. The losses are expected to disappear over the next year or so, with forecasts for a profit of US$0.82 per share this year. Prior to this update, the analysts had been forecasting revenues of US$5.0b and earnings per share (EPS) of US$0.49 in 2022. There has definitely been an improvement in perception recently, with the analysts substantially increasing both their earnings and revenue estimates.

View our latest analysis for Hyatt Hotels

earnings-and-revenue-growth
earnings-and-revenue-growth

Although the analysts have upgraded their earnings estimates, there was no change to the consensus price target of US$95.78, suggesting that the forecast performance does not have a long term impact on the company's valuation. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Hyatt Hotels analyst has a price target of US$114 per share, while the most pessimistic values it at US$80.00. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. One thing stands out from these estimates, which is that Hyatt Hotels is forecast to grow faster in the future than it has in the past, with revenues expected to display 88% annualised growth until the end of 2022. If achieved, this would be a much better result than the 15% annual decline over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 18% per year. So it looks like Hyatt Hotels is expected to grow faster than its competitors, at least for a while.

The Bottom Line

The biggest takeaway for us from these new estimates is that analysts upgraded their earnings per share estimates, with improved earnings power expected for this year. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. The lack of change in the price target is puzzling, but with a serious upgrade to this year's earnings expectations, it might be time to take another look at Hyatt Hotels.

Still, the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Hyatt Hotels analysts - going out to 2024, and you can see them free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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