Hyatt Hotels Corporation's (NYSE:H) Recent Stock Performance Looks Decent- Can Strong Fundamentals Be the Reason?

Simply Wall St.11-21 20:18

Hyatt Hotels' (NYSE:H) stock up by 6.7% over the past three months. Given its impressive performance, we decided to study the company's key financial indicators as a company's long-term fundamentals ...

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Given its impressive performance, we decided to study the company's key financial indicators as a company's long-term fundamentals ...</p>\n\n<a href=\"https://finance.yahoo.com/news/hyatt-hotels-corporations-nyse-h-121830517.html\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"BK4142","symbol_name":"酒店、度假村与豪华游轮","start_time":0,"source_url":"https://finance.yahoo.com/news/hyatt-hotels-corporations-nyse-h-121830517.html","article_id":"2485981224","we_media_id":null,"thumbnails":["https://s.yimg.com/uu/api/res/1.2/CGL6VNgxo0F2rWKNpuY88A--~B/aD00MzI7dz0xMTk0O2FwcGlkPXl0YWNoeW9u/https://media.zenfs.com/en/simply_wall_st__316/cb90bae557d50c77576d28ff3b1c0eed"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2485981224","pubTimestamp":1732191510,"sourceInfo":{"source_id":"yahoofinance","name":"雅虎金融"},"weMediaInfo":null,"summary":"Hyatt Hotels'  stock up by 6.7% over the past three months. Given its impressive performance, we decided to study the company's key financial indicators as a company's long-term fundamentals usually dictate market outcomes. Specifically, we decided to study Hyatt Hotels'  ROE in this article.Return on Equity or ROE is a test of how effectively a company is growing its value and managing investors’ money. In other words, it is a profitability ratio which measures the rate of return on the capital provided by the company's shareholders.Return on Equity = Net Profit  ÷ Shareholders' Equity. So, based on the above formula, the ROE for Hyatt Hotels is:. Hyatt Hotels has a really low three-year median payout ratio of 6.3%, meaning that it has the remaining 94% left over to reinvest into its business. So it looks like Hyatt Hotels is reinvesting profits heavily to grow its business, which shows in its earnings growth.Moreover, Hyatt Hotels is determined to keep sharing its profits with shareh","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"BK4142":"酒店、度假村与豪华游轮","NYSE":"纽交所","H":"凯悦酒店","BK4585":"ETF&股票定投概念"},"translate_title":"凯悦酒店集团（纽约证券交易所股票代码：H）最近的股票表现看起来不错——强劲的基本面可能是原因吗？","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"H":1,"NYSE":1},"content_text":"Hyatt Hotels' (NYSE:H) stock up by 6.7% over the past three months. Given its impressive performance, we decided to study the company's key financial indicators as a company's long-term fundamentals usually dictate market outcomes. Specifically, we decided to study Hyatt Hotels'  ROE in this article. \n Return on Equity or ROE is a test of how effectively a company is growing its value and managing investors’ money. In other words, it is a profitability ratio which measures the rate of return on the capital provided by the company's shareholders. \n View our latest analysis for Hyatt Hotels \n How To Calculate Return On Equity? \n The formula for ROE is: \n Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity \nSo, based on the above formula, the ROE for Hyatt Hotels is:\n37% = US$1.4b ÷ US$3.7b (Based on the trailing twelve months to September 2024).\n The 'return' is the yearly profit. Another way to think of that is that for every $1 worth of equity, the company was able to earn $0.37 in profit. \n What Is The Relationship Between ROE And Earnings Growth? \n Thus far, we have learned that ROE measures how efficiently a company is generating its profits. We now need to evaluate how much profit the company reinvests or \"retains\" for future growth which then gives us an idea about the growth potential of the company. Generally speaking, other things being equal, firms with a high return on equity and profit retention, have a higher growth rate than firms that don’t share these attributes. \n Hyatt Hotels' Earnings Growth And 37% ROE \n To begin with, Hyatt Hotels has a pretty high ROE which is interesting. Additionally, the company's ROE is higher compared to the industry average of 13% which is quite remarkable. So, the substantial 32% net income growth seen by Hyatt Hotels over the past five years isn't overly surprising. \n We then performed a comparison between Hyatt Hotels' net income growth with the industry, which revealed that the company's growth is similar to the average industry growth of 31% in the same 5-year period. \n\n\n\n  NYSE:H Past Earnings Growth November 21st 2024\n \n\n Earnings growth is an important metric to consider when valuing a stock. It’s important for an investor to know whether the market has priced in the company's expected earnings growth (or decline). This then helps them determine if the stock is placed for a bright or bleak future. Is H fairly valued? This infographic on the company's intrinsic value  has everything you need to know. \n Is Hyatt Hotels Making Efficient Use Of Its Profits? \n Hyatt Hotels has a really low three-year median payout ratio of 6.3%, meaning that it has the remaining 94% left over to reinvest into its business. So it looks like Hyatt Hotels is reinvesting profits heavily to grow its business, which shows in its earnings growth. \n Moreover, Hyatt Hotels is determined to keep sharing its profits with shareholders which we infer from its long history of seven years of paying a dividend. Looking at the current analyst consensus data, we can see that the company's future payout ratio is expected to rise to 19% over the next three years. Consequently, the higher expected payout ratio explains the decline in the company's expected ROE (to 16%) over the same period. \n Conclusion \n Overall, we are quite pleased with Hyatt Hotels' performance. In particular, it's great to see that the company is investing heavily into its business and along with a high rate of return, that has resulted in a sizeable growth in its earnings. With that said, on studying the latest analyst forecasts, we found that while the company has seen growth in its past earnings, analysts expect its future earnings to shrink. To know more about the latest analysts predictions for the company, check out this visualization of analyst forecasts for the company. \nHave feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. 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