MAR - Embedded Expectations Analysis - 2018 10 25
Marriott International, Inc. (MAR:USA) currently trades near recent averages relative to UAFRS-based (Uniform) Earnings, with a 21.5x Uniform P/E. At these levels, the market is pricing in bullish expectations for the firm, and management is confident in their loyalty program, new home offerings, and improved G&A expensesSpecifically, management is confident that their guests can find MAR properties around the globe, which increases the value of their loyalty program. Additionally, they are confident that they will deliver a consistent experience with their new home offerings, and that 75% of their business comes through their channels, as opposed to an online travel agency. They are also confident that their lower G&A expenses contributed positively to their improved EPS, and that they will continue to cut G&A costs in FY 2019. Moreover, they are confident that the impact of additional profit-sharing costs will total $18mn in H2 2018, and that gains on asset sales totaled $119mn in Q2 2018
Marriott International is a worldwide operator, franchisor, and licensor of hotel, residential and timeshare properties under various brand names at different price and service points. The company has operations in the following reportable business segments: North American Full-Service, which includes the company's Luxury and Premium properties located in United States and Canada; North American Limited-Service, which includes the company's Select properties located in United States and Canada; and Asia Pacific, which includes all properties in the company's Asia Pacific region.
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