The pandemic has been a negative for leisure as well as business travel. However, if we take a longer-term view, then it is quite likely that travel will rebound once the pandemic subsides and vaccination drives scale up. Many of the hotel stocks have been impacted by the negative sentiment arising out of the pandemic. However, investors looking to go long at this time may want to consider stocks like Choice Hotels International. The stock has rebounded strongly since the peak of the pandemic. It also has a strong brand which is a critical metric in the competitive hotel industry.
More About Choice Hotels
Choice Hotels International is one of the largest hotel chains in the world. It has close to 600,000 hotel rooms in the world. Choice Hotels operates well-known brands like Comfort Suites, Comfort Inn, Quality Inn, Sleep Inn, Clarion Hotels, and Cambria Hotels. The company operates on a franchise model that allows it to scale up quickly without high capital requirements. 99% of the company’s total revenue comes from franchises. Geographically, the US market accounts for 78% of the total rooms for Choice Hotels. Choice Hotels experienced strong demand before the pandemic and its brand strength and scale should allow it to perform strongly in the future as well.
Choice Hotels stock closed at $106 on 5th February 2021. It has almost doubled since the March 2020 market crash. Currently, the stock trades at a 0.84% dividend yield. Choice Hotels is up more than 100% in the last 5 years as well. Another well-known hotel company is Marriott International. Its stock closed at $129 on 5th February 2021. The stock trades at a 1.48% dividend yield and has doubled since the March 2020 market fall. Wyndham Hotels is another one to consider. Its stock has nearly trebled from the lows of March 2020. The stock closed at $61 on 5th February 2021.