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Marriott International, Inc. (MAR) Q4 Earnings Preview: 3 Key Metrics Say A Beat Is On The Way

 February 19, 2013 09:52 AM
 


(By Rich Bieglmeier) Marriott International, Inc. (MAR) will report fourth quarter and full year 2012 earnings results on Tuesday, February 19, 2013, at approximately 5:00 pm Eastern Time (ET).  The company will hold a conference call for the investment community to discuss its fourth quarter and full year 2012 earnings on Wednesday, February 20, 2013 at 10 a.m. ET. Wall Street anticipates that MAR will earn $0.55 for the quarter. iStock expects the hotel chain to report earnings that will beat Wall Street's consensus number. The iEstimate is $0.58, a 3 cent upside surprise.

Marriott International has more than 3,700 properties in 74 countries and territories. The company operates and franchises hotels and licenses vacation ownership resorts under 18 brands, including Marriott Hotels & Resorts, The Ritz-Carlton, JW Marriott, Bulgari, EDITION, Renaissance, Gaylord Hotels, Autograph Collection, AC Hotels by Marriott, Courtyard, Fairfield Inn & Suites, SpringHill Suites, Residence Inn, TownePlace Suites, Marriott Executive Apartments, Marriott Vacation Club, Grand Residences by Marriott, and The Ritz-Carlton Destination Club.

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For the most part, MAR has exceeded Wall Street's consensus number, topping the quarterly guesstimate 10 of the last 16 announcements by an average of 16.9%; however, a 72% beast skews the result. Take it out and the average falls to 10.8%.

Marriott split the reaming three announcements equally with three on target eps results and three bearish surprises by an average by -2.13%, -3.70%, and -15.15%.

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The stock rewards were also split down the middle in the last 16 quarterly checkups. The eight rallies carried shares higher by an average of 5.63% in the days surrounding earnings news, and the average fall for the remaining eight was 4.20%.

At home, the three key metrics for the lodging industry appear to be headed in the right direction for MAR. Occupancy, the average daily rate, and revenue room per room were up in the Americas during the fourth quarter.

The picture was mixed in Europe with occupancy increasing. According to STR Global, "European hotels during December reported the highest increase in occupancy for any month in 2012." However, in dollar-terms, the average daily rate, and revenue room per room were both down 4%. So, currency conversions could be a negative for Tuesday's announcement.

In Asia, STR reports, "occupancy ended the year virtually flat with a 0.5-percent increase to 68.3 percent, its average daily rate increased 0.9 percent to US$129.26 and its revenue per available room was up 1.4 percent to US$88.25."

On Friday, February 15, 2013, management announced "its board has increased the authorization to repurchase the Company's Class A common stock by an additional 25 million shares, for a total of approximately 34 million shares currently authorized for repurchase." iStock reads this as an aggressive move on the eve of earnings. It could mean the company sees the stock price as a "value" based on the current trend and better than expected announcement coming on Tuesday.

Overall: The profit movers for Marriott International, Inc. (MAR) appear to be making reservations for another bullish beat. Add in management's repurchase news, and the upcoming eps report is likely to break the stock performance tie in favor of bulls.

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