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Likely Coronavirus Impact on Marriott (MAR) Q1 Earnings

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Marriott International, Inc. (MAR - Free Report) is scheduled to report first-quarter 2020 results on May 11, before the opening bell. In the last reported quarter, the company’s earnings surpassed the Zacks Consensus Estimate by 7.5%.

Q1 Expectations

The Zacks Consensus Estimate for first-quarter earnings is pegged at 95 cents, lower than $1.41 reported in the prior-year quarter. Over the past 30 days, the company’s earnings estimates have been revised downward by 13 cents. The Zacks Consensus Estimate for revenues stands at $4,059 million, suggesting decline of 19% from the year-ago quarter reported figure.

Factors at Play

Marriot first-quarter results are likely to reflect the impact of the coronavirus pandemic. The outbreak has impacted the company’s operations in China and rest of the world, leading to closure of numerous hotels and reduced demand. On April 2020, the company announced that 25% of the company’s more than 7,300 hotels are temporarily closed due to the pandemic.

The company recently announced that compared with February levels, occupancy and RevPAR have declined significantly in March across all regions except Greater China. Notably, the company anticipates worldwide system-wide RevPAR to decline approximately 23% in first-quarter 2020. RevPAR in North America is expected to fall 20%. The company stated that current occupancy in North America is nearly 10% but the same is below 10% in Europe.

The company’s results in the quarter to be reported are likely to reflect dismal RevPAR in Europe, Caribbean and Latin America, and the Middle East and Africa. Moreover, increase in expenses is likely to have negatively impacted the company’s performance in the quarter to be reported.

Marriott International Inc Price and EPS Surprise


What the Zacks Model Unveils

Our proven model does not conclusively predict an earnings beat for Marriott 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's not the case here.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Marriott has a Zacks Rank #5 (Strong Sell) and an Earnings ESP of -12.32%.  

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 this quarter:

GP Strategies Corporation (GPX - Free Report) has an Earnings ESP of +58.33% and a Zacks Rank #3, at present.

BJ's Wholesale Club Holdings, Inc. (BJ - Free Report) currently has an Earnings ESP of +7.00% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Glu Mobile Inc. currently has an Earnings ESP of +600.00% and a Zacks Rank #3.

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