Hilton sees World Cup boost but shares fall on soft guidance

Hilton Worldwide Holdings Inc (NYSE:HLT) raised its full-year nett outlook connected Tuesday, but shares fell 3.4% aft third-quarter guidance came successful beneath Wall Street estimates.

The edifice relation present expects full-year adjusted net per stock of $8.89 to $9.01, up from $8.79 to $8.91 previously.

Full-year adjusted EBITDA is projected astatine $4.04 cardinal to $4.08 billion, supra the anterior scope of $4.02 cardinal to $4.06 billion.

Full-year nett income guidance was trimmed to $1.88 cardinal to $1.91 cardinal from $1.91 cardinal to $1.94 billion.

For the 2nd quarter, Hilton posted adjusted net of $2.29 per share, topping estimates of $2.27, connected adjusted EBITDA of $1.05 billion, up of the $1.04 cardinal expected.

But third-quarter guidance disappointed. Hilton forecast adjusted net of $2.28 to $2.34 per share, beneath the $2.42 analysts had projected, with adjusted EBITDA guided to $1.035 cardinal to $1.055 cardinal versus estimates of $1.08 billion.

Updated full-year guidance calls for system-wide comparable RevPAR maturation of 3% to 3.5%, up from 2% to 3%. Net portion maturation guidance held dependable astatine 6% to 7%, with the 2nd fractional of the twelvemonth expected to outperform the first.

Management said third-quarter RevPAR maturation of astir 4% is expected connected a changeless currency basis, aided by the World Cup, portion the 4th fourth faces a headwind from the US midterm elections.

Hilton's improvement pipeline grew 6% year-over-year to 541,300 rooms, up astir 14,300 rooms from the anterior 4th and good supra the astir 5,000-room gait a twelvemonth earlier. Nearly fractional the pipeline is nether construction, and much than fractional is located extracurricular the US. The institution opened 207 hotels during the quarter, adding 21,600 rooms net.

Capital returns for the twelvemonth stay projected astatine astir $3.5 billion.

Analysts astatine Jefferies said the results bespeak continued spot successful Hilton's concern model, though the shifting calendar effects successful the guidance should beryllium astir neutral for shares, fixed their 7.3% diminution implicit the anterior 40 days.