Hilton Hikes Profit Forecast

Booming lodging demand helped Hilton Hotels (HLT Quote - Cramer on HLT - Stock Picks) beat Wall Street's estimates for its second quarter, and the hotelier also raised its earnings forecast.

Hilton said net income jumped to $202 million, or 49 cents a share, from $75 million, or 19 cents a share, a year earlier.

Excluding special items, Hilton earned 27 cents a share, up from 18 cents a share a year earlier and solidly ahead of the 24-cent average analyst EPS forecast from Thomson First Call.

Revenue rose 10% to $1.18 billion from $1.07 billion a year earlier and beat the $1.16 billion analyst consensus. Shares of Hilton were up 14 cents to $24.54.

"All three facets of our business -- owned hotels, management and franchising, and timeshare -- are performing very well, taking full advantage of the robust business trends that continue to mark our industry's recovery, and this has translated into another quarter of strong results," said Stephen F. Bollenbach, Hilton's CEO, in a news release.

Hilton said revenue per available room, a key lodging industry metric also known as revpar, increased by 9.4% year over year at hotels Hilton owned at least a year. Hilton cited strength in the key markets of New York City, Hawaii and Boston, along with a significant improvement in Chicago.

Margins at hotels Hilton owned for at least a year swelled 160 basis points from a year before. Hilton's vacation timeshare business continued to perform well, with profitability up 44% on strong sales in Las Vegas, Orlando, Fla., and Hawaii. Revenue grew 39% to $136 million.

Looking ahead, Hilton raised its full-year adjusted EPS forecast to a range of 82 cents to 84 cents. The company's previous range was 78 cents to 80 cents, and the analyst consensus was for 81 cents.

Hilton also said it now expects full-year revpar growth of 9.5% to 10.5%, better than its previous range of 8% to 9%.