The hotel industry, which had been crippled by the coronavirus pandemic, is slowly regaining momentum. Case in point, demand at Hilton Worldwide Holdings Inc. (HLT - Free Report) hotels in China and Japan are returning to normal level an executive said, according to Reuters.
Revenue per available room (RevPAR) has increased in China during the Golden Week holiday in the prior week. It is worth mentioning that all hotels of Hilton in China have resumed operations.
Hilton president Asia-Pacific Alan Watts said “Demand in China and Japan is somewhat back to normal. Obviously the international business and inbound business particularly will be trailing those numbers.” Watts further added that travel demand throughout Asia is improving.
Occupancy to Improve
With restrictions being lifted and properties reopening globally, Hilton’s business is likely to pick up on improved demand post the summer period. Notably, management expects hotel occupancy levels to improve 40-50% by late summer (or early fall).
Hilton, which shares space with Hyatt Hotels Corporation (H - Free Report) , Wyndham Hotels & Resorts, Inc. (WH - Free Report) and Marriott International, Inc. (MAR - Free Report) , continues to invest heavily in the digital platform to provide seamless and contactless experience to customers. Notably, features including digital check-in, room selection and ability to message hotel team members through personal devices bode well. These initiatives combined with its new approach toward cleaning and sanitation are likely to boost consumer confidence amid the pandemic. Moreover, the company has extended its cancellation policies to help Honors member maintain their points and status amid the crisis. To this end, the company has partnered with American Express in order to provide Honors members with greater flexibility and more points for future travel purposes.
Year to date, the company’s shares have fallen 20.4%, compared with the industry’s decline of 26.7%.
Hilton currently has a Zacks Rank #5 (Strong Sell).
You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here..
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