NEW YORK (
has reinstated its cash dividend -- but that doesn't mean its time to jump in and buy the stock.
Indeed, the reinstatement is, of course, a good sign. Still, according to John Staszak, an analyst at Argus Research Company, Marriott has yet to hit the bottom, and the company is still stabilizing.
"Now is not a great time to buy," Staszak says.
Staszak adds that retail investors shouldn't jump in and buy Marriott until pricing really improves and the company starts raising rates -- and right now Marriott is evidencing no real improvement in its RevPar (revenue per available room).
"They've been filling rooms while cutting prices," Staszak said.
On Jan. 7, Marriott said that it expects its fourth-quarter 2009 RevPar for comparable system-wide hotels outside North America will have declined 14% to 16% on a constant dollar basis. Also, Marriott expects comparable system-wide RevPar inside North America will have declined 13% to 14%.
Marriott's board had decided to pay the last three quarterly dividends in stock rather than cash, given the level of economic uncertainty plaguing the hotel industry.
However, the board agreed to return to a cash dividend after the company reduced its total debt levels by almost $800 million to $2.3 billion, by the end of 2009.
Meanwhile, the U.S. hotel industry reported mixed results in three key measurements during the week of January 24 to 30, according to data from STR Global.
In year-over-year measurements, the industry's occupancy ended the week up 1.9 to 48.8%. Meanwhile, the average daily rate dropped 5.6% to finish the week at $94.92. RevPar for the week fell 3.8% to finish at $46.31.
On the day, hotel stocks are trading mixed, while Marriott is up 1.4% at $26.10.
Starwood Hotels & Resorts Worldwide
stock is up 3.9% at $36.80 and
has edged lower to $20.60, down 0.6%.
is down 1.6% at $28.60.
-- Reported by Andrea Tse in New York
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