Skip to main content

Market Overview

The Positive And Negative For China Lodging Group

The Positive And Negative For China Lodging Group

Goldman Sachs maintains its Neutral rating on China Lodging Group, Ltd (ADR) (NASDAQ: HTHT) saying the RevPAR boost from Shanghai Disney should "offset potentially slower openings."

Shanghai Disney will officially open June 16. Disney sees 14+ million visitors a year; Goldman, therefore, expects Shanghai Disney to potentially add 5–10 percent RevPAR for China Lodging Group's 358 hotels in Shanghai or ~1–2 percent RevPAR increment to the entire portfolio. As of the first quarter of 2016, 12 percent of China Lodging's hotels were located in Shanghai and 23 percent in the YRD region.

"We factor in faster RevPAR growth from Disney, partly offset by a slower pace of openings, and revise 2016-18E EPS by +1 to -2 percent," analyst Justin Kwok wrote in a note.

Related Link: Disney: "Next Stop, Shanghai"

Meanwhile, Goldman said the "relatively challenging operating environment in lower-tier cities may affect some franchisees' profitability." Moreover, the company's focus on quality over quantity may lead to a slower pace of franchise additions.

"As the company already added 226 hotels in 1Q16, and has another 632 hotels in the pipeline, we see limited risk for our 2016E c.776 opening target. However, we have turned more cautious thereafter, and have lowered new openings to 662 and 562 in 2017E and 2018E, respectively," Kwok noted.

Kwok maintains his $39 price target on the stock, which closed Friday's regular trading session at $33.91 and was up 1.36 percent early Monday at $34.37.

Latest Ratings for HTHT

Dec 2020Credit SuisseDowngradesOutperformNeutral
Aug 2020B of A SecuritiesUpgradesNeutralBuy
Mar 2020CitigroupDowngradesBuyNeutral

View More Analyst Ratings for HTHT
View the Latest Analyst Ratings


Related Articles (HTHT)

View Comments and Join the Discussion!

Posted-In: Analyst Color Long Ideas Price Target Reiteration Travel Analyst Ratings Trading Ideas General

Latest Ratings

OSPNSidoti & Co.Upgrades39.0
PLTSidoti & Co.Upgrades48.0
LRCXArgus ResearchMaintains725.0
ROSTLoop CapitalMaintains145.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Everything you need to know about the latest SPAC news.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at