A Quick Look At Hyatt’s Brand Portfolio, And The Outlook For Key Brands Over Coming Years

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Hyatt Hotels

Hyatt Hotels (NYSE:H) is one of the largest hotel chains in the world with 843 properties and 208,207 rooms in its portfolio. With Airbnb disrupting the global hospitality industry over recent years, hotel chains have been forced to undergo a phase of transformation to counter the threat of mushrooming hospitality service providers. In this article, we take a look at the various brands under Hyatt’s portfolio and the transformation the company has been undergoing with a dual aim of expanding its global footprint and stimulating growth.

Per Trefis estimates, Hyatt’s shares have a fair value of $74, which is slightly ahead of the current market price. You can view our interactive dashboard on How Has Hyatt Fared In Recent Quarters? to observe quarterly revenue trends and modify yearly projections to gauge the impact on the stock price. Additionally, you can find more of our Consumer Discretionary sector data here.

Hyatt’s Brand Portfolio

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Hyatt’s brand portfolio could be broadly classified into four categories: full-service hotels, select service hotels, wellness hotels, and resort brands on the basis of the targeted customer profile, the services offered as well as the destination.

  • Full-Service Hotels cater to the most affluent class of business and leisure travelers and include facilities for small meetings and events. Hyatt operates seven hotel brands in this category with Hyatt Regency, Grand Hyatt, and Park Hyatt being the prominent ones. In 2018, these brands had a collective share of 71% of the total rooms and nearly double the average daily rate of select service hotels. However, the share of these brands in Hyatt’s total revenues has trended lower over the years, and is expected to continue to decline going forward.
  • Select Service Hotels have been the fastest-growing category and is the key focus of Hyatt’s long-term strategy due to a shift in demand towards affordable stay from increased market competition. Hyatt Place and Hyatt House are the prominent brands in this category. Over the last 8 years, this category’s share of total rooms has increased from 20% to 29%, and keeping in mind the high demand for this category of rooms in Asia-Pacific region, we expect it to increase its share to 35% in the next 5 years.
  • Wellness category includes Miraval and Exhale brands, which Hyatt acquired in 2017 to tap into the increasing demand for health tourism, where travelers look for wellness activities such as meditation, fitness, nature walks, etc. as a part of their vacation.
  • Resort brands are all-inclusive destinations hotels which cater to all category of customers with a focus on the quality of food and beverage, as well as hospitality. Hyatt launched its Ziva and Zilara brands in 2013 to make vacation experiences more memorable for guests and to expand its footprint in the Latin American market.

While the Wellness hotels and Resort brands account for roughly 1% of Hyatt’s total rooms, they are likely to witness strong growth over coming years.

The chart below capture the trends in Hyatt’s revenues, expenses and operating income over recent years along with our forecast for 2019. You can modify our forecast and see the impact of changes on Hyatt’s share price in our interactive dashboard for Hyatt.

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