Strong First Quarter Could Lead into Choppy 2023 for Public Hotel Companies
Wall Street Analysts Say Macroeconomic Factors Could Dampen Results
Challenges and opportunities abound in 2023 for publicly traded hotel companies, and Wall Street analysts who cover those companies say the good and bad won't be felt evenly across different types of companies or throughout the calendar year.
Challenges and opportunities abound in 2023 for publicly traded hotel companies, and Wall Street analysts who cover those companies say the good and bad won't be felt evenly across different types of companies or throughout the calendar year.
One of the overarching themes of the year is strong performance in the first quarter might be hard to replicate in the following nine months, said Michael Bellisario, senior research analyst at Baird.
In 2022, the industry benefited from inflation by driving high room rates while keeping a lid on costs, but Bellisario expects that to reverse in 2023 with cost increases outpacing rate growth.
Growing macro [economic] pressures could impact performance, and the expectation is that's probably a bigger impact in the back half of the year than the front half,"
he said.
C. Patrick Scholes, managing director of lodging and leisure equity research for Truist Securities, struck a more optimistic tone overall, but agreed that the first quarter's numbers will be hard to match.