The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Soho House (NYSE: SHCO) and the rest of the travel and vacation providers stocks fared in Q3.
Airlines, hotels, resorts, and cruise line companies often sell experiences rather than tangible products, and in the last decade-plus, consumers have slowly shifted from buying "things" (wasteful) to buying "experiences" (memorable). In addition, the internet has introduced new ways of approaching leisure and lodging such as booking homes and longer-term accommodations. Traditional airlines, hotel, resorts, and cruise line companies must innovate to stay relevant in a market rife with innovation.
The 19 travel and vacation providers stocks we track reported a mixed Q3. As a group, revenues beat analysts’ consensus estimates by 1.1% while next quarter’s revenue guidance was in line.
Thankfully, share prices of the companies have been resilient as they are up 8% on average since the latest earnings results.
Soho House (NYSE: SHCO)
Boasting fancy locations in hubs such as NYC and Miami, Soho House (NYSE: SHCO) is a global hospitality brand offering exclusive private member clubs, hotels, and restaurants.
Soho House reported revenues of $333.4 million, up 13.6% year on year. This print was in line with analysts’ expectations, but overall, it was a softer quarter for the company with full-year EBITDA and revenue guidance missing analysts’ expectations.
"Our third quarter results reflect the strength of our membership model. Membership revenues grew 17% year-on-year, while we achieved our highest ever quarterly Total revenues and Adjusted EBITDA. At the end of the period, we opened Soho Mews House in London, our 45th House, with great feedback from members. We have continued to see significant demand for other recent openings, including Sao Paulo, Mexico City and Portland,” said Andrew Carnie, CEO of Soho House & Co.
Soho House delivered the weakest full-year guidance update of the whole group. Interestingly, the stock is up 79.9% since reporting and currently trades at $8.85.
Read our full report on Soho House here, it’s free.
Best Q3: Pursuit (NYSE: PRSU)
With attractions ranging from glacier tours in the Canadian Rockies to an oceanfront geothermal lagoon in Iceland, Pursuit Attractions and Hospitality (NYSE: PRSU) operates iconic travel experiences, experiential marketing services, and exhibition management across North America and Europe.
Pursuit reported revenues of $116.7 million, down 69.2% year on year, outperforming analysts’ expectations by 6.9%. The business had a stunning quarter with a beat of analysts’ EPS estimates and full-year EBITDA guidance exceeding analysts’ expectations.
The market seems happy with the results as the stock is up 22% since reporting. It currently trades at $36.64.
Is now the time to buy Pursuit? Access our full analysis of the earnings results here, it’s free.
Weakest Q3: Hilton Grand Vacations (NYSE: HGV)
Spun off from Hilton Worldwide in 2017, Hilton Grand Vacations (NYSE: HGV) is a global timeshare company that provides travel experiences for its customers through its timeshare resorts and club membership programs.
Hilton Grand Vacations reported revenues of $1.27 billion, up 2.5% year on year, falling short of analysts’ expectations by 8.1%. It was a disappointing quarter as it posted and a significant miss of analysts’ adjusted operating income estimates.
Hilton Grand Vacations delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 11.6% since the results and currently trades at $44.88.
Read our full analysis of Hilton Grand Vacations’s results here.
United Airlines (NASDAQ: UAL)
Founded in 1926, United Airlines Holdings (NASDAQ: UAL) operates a global airline network, providing passenger and cargo air transportation services across domestic and international routes.
United Airlines reported revenues of $15.24 billion, up 1.7% year on year. This print missed analysts’ expectations by 0.9%. It was a slower quarter as it also produced a miss of analysts’ EBITDA estimates and full-year EPS guidance slightly missing analysts’ expectations.
The stock is up 19.6% since reporting and currently trades at $105.84.
Read our full, actionable report on United Airlines here, it’s free.
Delta (NYSE: DAL)
One of the ‘Big Four’ airlines in the US, Delta Air Lines (NYSE: DAL) is a major global air carrier that serves both business and leisure travelers through its domestic and international flights.
Delta reported revenues of $16.65 billion, flat year on year. This number topped analysts’ expectations by 1.5%. Overall, it was a strong quarter as it also recorded a beat of analysts’ EPS estimates and full-year EPS guidance topping analysts’ expectations.
The stock is up 17.5% since reporting and currently trades at $59.54.
Read our full, actionable report on Delta here, it’s free.
Market Update
The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.
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