Hilton Worldwide Holdings (NYSE: HLT) and Hyatt Hotels Corporation (NYSE:H) are both mid-cap consumer discretionary companies, but which is the better investment? We will contrast the two businesses based on the strength of their earnings, valuation, dividends, profitability, risk, analyst recommendations and institutional ownership.

Insider and Institutional Ownership

31.0% of Hyatt Hotels Corporation shares are held by institutional investors. 1.5% of Hilton Worldwide Holdings shares are held by company insiders. Comparatively, 25.5% of Hyatt Hotels Corporation shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Dividends

Hilton Worldwide Holdings pays an annual dividend of $0.60 per share and has a dividend yield of 1.0%. Hyatt Hotels Corporation does not pay a dividend. Hilton Worldwide Holdings pays out 461.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Analyst Ratings

This is a summary of recent ratings and target prices for Hilton Worldwide Holdings and Hyatt Hotels Corporation, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Hilton Worldwide Holdings 1 5 10 0 2.56
Hyatt Hotels Corporation 0 10 2 0 2.17

Hilton Worldwide Holdings currently has a consensus price target of $71.43, indicating a potential upside of 14.40%. Hyatt Hotels Corporation has a consensus price target of $56.86, indicating a potential upside of 0.29%. Given Hilton Worldwide Holdings’ stronger consensus rating and higher possible upside, equities analysts plainly believe Hilton Worldwide Holdings is more favorable than Hyatt Hotels Corporation.

Valuation & Earnings

This table compares Hilton Worldwide Holdings and Hyatt Hotels Corporation’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Hilton Worldwide Holdings $7.39 billion 2.74 $2.78 billion $0.13 480.09
Hyatt Hotels Corporation $2.72 billion 0.81 $671.00 million $2.00 28.35

Hilton Worldwide Holdings has higher revenue and earnings than Hyatt Hotels Corporation. Hyatt Hotels Corporation is trading at a lower price-to-earnings ratio than Hilton Worldwide Holdings, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Hilton Worldwide Holdings has a beta of 1.29, indicating that its share price is 29% more volatile than the S&P 500. Comparatively, Hyatt Hotels Corporation has a beta of 1.28, indicating that its share price is 28% more volatile than the S&P 500.

Profitability

This table compares Hilton Worldwide Holdings and Hyatt Hotels Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Hilton Worldwide Holdings 0.39% 19.65% 3.76%
Hyatt Hotels Corporation 5.71% 6.78% 3.36%

Summary

Hilton Worldwide Holdings beats Hyatt Hotels Corporation on 11 of the 16 factors compared between the two stocks.

Hilton Worldwide Holdings Company Profile

Hilton Worldwide Holdings Inc. is a hospitality company. The Company is engaged in owning, leasing, managing and franchising hotels and resorts. The Company’s segments include ownership, and management and franchise. Its global portfolio of owned and leased properties includes a range of hotels in gateway cities, such as New York City, London, San Francisco, Chicago, Sao Paolo and Tokyo. The Company’s management and franchise segment manages hotels and licenses its brands to franchisees. Its brand portfolio includes Hilton Hotels & Resorts, Waldorf Astoria Hotels & Resorts, Conrad Hotels & Resorts, Canopy by Hilton, Curio-A Collection by Hilton, DoubleTree by Hilton, Embassy Suites by Hilton, Hilton Garden Inn, Hampton by Hilton, Tru by Hilton, Homewood Suites by Hilton and Home2 Suites by Hilton. As of December 31, 2016, the Company owned, leased, managed or franchised 4,875 hotel and resort properties, totaling 796,440 rooms in 104 countries and territories.

Hyatt Hotels Corporation Company Profile

Hyatt Hotels Corporation is a global hospitality company. The Company develops, owns, operates, manages, franchises, licenses or provides services to a portfolio of properties. The Company operates through four segments: owned and leased hotels; Americas management and franchising (Americas); ASPAC management and franchising (ASPAC), and EAME/SW Asia management and franchising (EAME/SW Asia). The owned and leased hotels segment consists of its owned and leased full service and select service hotels. The Americas segment consists of its management and franchising of properties located in the United States, Latin America, Canada and the Caribbean. The ASPAC segment consists of its management and franchising of properties located in Southeast Asia, as well as China, Australia, South Korea, Japan and Micronesia. The EAME/SW Asia segment consists of its management and franchising of properties located in Europe, Africa, the Middle East, India, Central Asia and Nepal.

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