Marriott International Inc (NASDAQ: MAR) stock rises on better than estimated performance

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Marriott International Inc (NASDAQ: MAR) stock rose over 2.7% on 5th November, 2019 (Source: Google finance). For the third quarter, the company has reported comparable revenue per available room rose 1.5% world-wide, within the company’s guidance for 1% to 2%. The company now expects comparable revenue per available room, adjusted for currency fluctuations, to be at the low end of its guidance of 1% to 2% growth. Additionally, the company repurchased 3.8 million shares of common shares in the 2019 third quarter for $500 million at an average price of $133.41 per share.  Year-to-date through November 1, the company has already repurchased 14.2 million shares for $1.83 billion at an average price of $128.79 per share. For FY 19, the company expects adjusted EBITDA to be in the range of $3,572 million to $3,587 million, a 3 percent increase over 2018 adjusted EBITDA of $3,473 million. The company expects investment spending in 2019 will be total of approximately $1,000 million to $1,100 million, including approximately $225 million for maintenance capital.

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At the end of quarter, Marriott’s total debt was $10,779 million and cash balances had totaled $276 million, compared to $9,347 million in debt and $316 million of cash at year-end 2018.

In October 2019, the company had issued $550 million of Series DD Senior Notes due in 2022. The company expects to use the net proceeds for general corporate purposes.

MAR in the third quarter of FY 19 has reported the adjusted earnings per share of $1.47. The company now expects $5.87 to $5.90 a share in earnings for the year, down from $5.97 to $6.06 a share. That guidance has not included any gain that will arise on the sale of the St. Regis New York hotel, which Marriott sold to the Qatar Investment Authority for $310 million though it will continue to manage the property.

The company had added 117 new properties (17,720 rooms) to its worldwide lodging portfolio during the third quarter of 2019 and had exited Eleven properties (1,464 rooms).  At the end of third quarter, Marriott’s lodging system encompassed 7,200 properties and timeshare resorts with nearly 1,362,000 rooms. At the end of the quarter, the company’s worldwide development in pipeline totaled 2,947 properties with nearly 495,000 rooms, including 1,172 properties with approximately 214,000 rooms under construction and 201 properties and the company has approved more than 31,000 rooms for development, but not yet subject to signed contracts.

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