How Will Marriott International (MAR) Stock Be Affected By The Company's Expansion News?

NEW YORK (TheStreet) -- Marriott International  (MAR) announced that it is planning to add up to 1,300 new hotels and 235,000 new rooms worldwide by 2017.

The expansion, which would mean the company would average opening six hotels a week until 2015, would increase the Marriott, Courtyard and Renaissance hotel operator's portfolio to 5,000 hotels in 100 countries.

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The company forecasts 2017 earnings to range between $4 and $4.60 per share. Full year earnings guidance for this fiscal year is $2.40 - $2.51 per diluted share.

Marriott shares are up 0.13% to $70.92 in trading on Monday.

TheStreet Ratings team rates MARRIOTT INTL INC as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:

"We rate MARRIOTT INTL INC (MAR) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, growth in earnings per share and increase in net income. We feel these strengths outweigh the fact that the company shows weak operating cash flow."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 5.6%. Since the same quarter one year prior, revenues slightly increased by 6.8%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 72.29% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, MAR should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • MARRIOTT INTL INC has improved earnings per share by 12.3% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, MARRIOTT INTL INC increased its bottom line by earning $2.01 versus $1.72 in the prior year. This year, the market expects an improvement in earnings ($2.51 versus $2.01).
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Hotels, Restaurants & Leisure industry average. The net income increased by 7.3% when compared to the same quarter one year prior, going from $179.00 million to $192.00 million.
  • The gross profit margin for MARRIOTT INTL INC is currently extremely low, coming in at 10.42%. Regardless of MAR's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 5.51% trails the industry average.
  • You can view the full analysis from the report here: MAR Ratings Report

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