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H World Group to Report Q4 Earnings: What's in Store for the Stock?

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H World Group Limited (HTHT - Free Report) is scheduled to report fourth-quarter 2024 results on March 20, before the opening bell.

Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.

In the last reported quarter, the company’s earnings missed the Zacks Consensus Estimate by 11.6%.

Trends in HTHT’s Estimate Revision

The Zacks Consensus Estimate for earnings is pegged at 27 cents, indicating a decline of 18.2% from the prior-year actual. In the past 30 days, the consensus estimate has been unchanged.

The consensus mark for revenues is pegged at $798.2 million, suggesting a 1.6% increase from the year-ago reported figure.

Factors Likely to Shape HTHT’s Quarterly Results

H World Group's fourth-quarter revenues are expected to have increased year over year on the back of steady growth in domestic travel demand. Also, focus on expansion efforts and hotel signings are likely to have contributed to the top line.

Owing to stable travel demand and healthy occupancy rates, HTHT expects revenue to increase 1-5% year over year for the fourth quarter of 2024. The company’s upper-mid segment growth, driven by rising brand recognition among customers and franchisees, is also expected to have aided its quarterly performance.

However, the company’s top line is likely to have been impacted by the ongoing revenue per available room (RevPAR) and average daily rate (ADR) pressure. The company expects a mid-single-digit year-over-year decline in RevPAR in the fourth quarter due to ADR pressure. Additionally, the planned closure of leased and owned hotels as part of the asset-light strategy is likely to have affected revenues in the to-be-reported quarter.

Meanwhile, operating costs due to business recovery and rising personnel costs are likely to have hurt the bottom line. The company has also been witnessing high selling and marketing expenses due to an increase in commissions and promotional expenses.

What Our Model Says About HTHT

Our proven model does not conclusively predict an earnings beat for H World Group this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that is not the case here.

Earnings ESP: H World Group has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Zacks Rank: The company currently has a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Stocks Poised to Beat Earnings Estimates

Here are some stocks from the Zacks Consumer Discretionary space that investors may consider, as our model shows that these have the right combination of elements to post an earnings beat.

MGM Resorts International (MGM - Free Report) currently has an Earnings ESP of +6.16% and a Zacks Rank of 3.

MGM's earnings for the to-be-reported quarter are expected to plunge 91.1% year over year. The company reported an earnings beat in the trailing three of four quarters and missed once, the average surprise being 21.8%.

Hilton Worldwide Holdings Inc. (HLT - Free Report) has an Earnings ESP of +1.52% and a Zacks Rank of 3 at present.

HLT reported better-than-expected earnings in the trailing four quarters, the average surprise being 5.1%. The company’s earnings for the to-be-reported quarter are expected to grow 5.9% year over year.

Choice Hotels International, Inc. (CHH - Free Report) currently has an Earnings ESP of +2.65% and a Zacks Rank of 3.

CHH's earnings for the to-be-reported quarter are expected to grow 7.8% year over year. The company registered an earnings beat in the trailing three of four quarters and missed once, the average surprise being 7.5%.

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