Core Viewpoint - Hilton Worldwide Holdings (HLT) has shown strong performance over the past year, with a 20% increase in share value despite sluggish travel spending in the United States [1] Company Performance - The company's capital-light business model has effectively generated solid cash flow, contributing to its stock performance [1]

Core Insights - Hilton's fourth-quarter comparable U.S. RevPAR declined by 1.6%, primarily due to the prolonged U.S. government shutdown, while international regions showed stronger growth [1][2] - System-wide RevPAR growth for Hilton was reported at 0.5% year over year on a comparable and currency-neutral basis, with international strength partially offsetting weaker U.S. demand [2][6] - The company is optimistic about improving trends into early 2026, supported by a strong development pipeline and international performance [3][4] Financial Performance - Adjusted EBITDA for Q4 rose approximately 10% to around $946 million, with full-year adjusted EBITDA reaching $3.7 billion, marking a 9% year-over-year increase [5][7] - Hilton returned a record $3.3 billion to shareholders in 2025 and anticipates returning about $3.5 billion in 2026 [5][8] - Diluted EPS adjusted for special items was reported at $2.08 for Q4, with guidance for 2026 EPS adjusted for special items expected to be between $8.65 and $8.77 [7][10] Development and Growth - Hilton opened nearly 200 hotels (approximately 26,000 rooms) in Q4, achieving a net unit growth of 6.7% for 2025, with a development pipeline exceeding 520,000 rooms [4][12][13] - Conversions accounted for about 40% of 2025 room openings, with expectations for conversions to remain a significant growth contributor [13][14] - The company launched new brands, including the Apartment Collection by Hilton, aimed at expanding its market presence [15][17] Market Outlook - For 2026, Hilton expects system-wide RevPAR growth of 1% to 2%, with positive trends anticipated from group demand and leisure travel [9][10] - The company highlighted macroeconomic factors such as easing inflation and a favorable regulatory environment that could support stronger performance in 2026 compared to 2025 [11] - Group demand is expected to outperform, with stable booking windows and a mid-single-digit increase in group position system-wide [20]

Core Viewpoint - Pershing Square Capital Management, led by Bill Ackman, has invested approximately $2 billion in Meta Platforms, anticipating significant long-term benefits from artificial intelligence (AI) despite recent stock price declines [1][1]. Investment Strategy - The hedge fund allocated about 10% of its capital to the Meta investment, indicating a strong belief in the company's undervalued potential [1]. - Ackman’s team noted that Meta's stock has increased by 11% in 2025 and 3% in 2026 through February 9, despite a 7.4% decline over the past year [1][1]. AI Initiatives - Concerns regarding Meta's spending on AI initiatives have affected its stock performance, but the investment team believes AI will enhance content recommendations and personalized advertising, potentially increasing user engagement through AI-driven tools [1][1]. Market Position - Ackman has shown interest in major technology companies, having previously invested in Amazon and Alphabet, positioning Pershing Square as a significant player in the tech investment landscape [1][1].

Core Insights - Hilton Worldwide Holdings Inc. reported strong financial performance for the fourth quarter of 2026, with an earnings per share (EPS) of $2.08, exceeding the estimated $2.02 [1][5] - The company's revenue for the fourth quarter reached $3.09 billion, surpassing the estimated $2.99 billion, marking a 3.34% increase over the Zacks Consensus Estimate and a significant rise from $2.78 billion in the same quarter last year [2][5] - Hilton's net income for the fourth quarter was $298 million, contributing to a total annual net income of $1.46 billion, with an adjusted EBITDA of $946 million for the quarter [3][5] Financial Metrics - Hilton's price-to-earnings (P/E) ratio is approximately 52.55, and its price-to-sales ratio is about 6.37 [4] - The enterprise value to sales ratio stands around 6.45, while the enterprise value to operating cash flow ratio is approximately 30.97 [4] - The earnings yield for Hilton is about 1.90%, providing insights into its valuation and financial efficiency [4] Business Model and Market Position - The company's asset-light business model, improved margins, and fee growth have contributed to its robust financial performance, even amidst macroeconomic pressures and challenges in the Chinese market [3] - Hilton has consistently surpassed revenue estimates three times in the past four quarters, underscoring its strong market position within the Zacks Hotels and Motels industry [2]

Core Insights - Hilton Worldwide Holdings Inc. reported strong fourth-quarter 2025 results, with earnings and revenues exceeding expectations and showing year-over-year growth [1][3][10] Financial Performance - Adjusted earnings per share (EPS) for Q4 2025 were $2.08, surpassing the Zacks Consensus Estimate of $2.00, and up from $1.76 in the same quarter last year [3] - Total revenues reached $3.09 billion, exceeding the consensus estimate of $2.99 billion by 3.3% and increasing by 10.9% year-over-year [3] - Adjusted EBITDA for the quarter was $946 million, reflecting a 10.3% increase year-over-year, and also beating the estimate of $928.8 million [6] Revenue Breakdown - Franchise and licensing fees improved to $671 million from $642 million year-over-year, although below the estimate of $718.9 million [4] - Base and other management fees rose to $98 million from $82 million year-over-year, while incentive management fees increased by 17.4% to $101 million [4] - Ownership revenues were $345 million, slightly below the expected $345.6 million [5] Operational Highlights - System-wide comparable RevPAR increased by 0.5% year-over-year on a currency-neutral basis [6] - The company added 190 hotels totaling approximately 26,000 rooms in Q4 2025, achieving a net room growth of about 21,300 rooms [11] - Hilton's development pipeline grew by 37,400 rooms, totaling 520,500 rooms across 3,703 hotels in 129 countries and territories as of December 31, 2025 [13] Future Outlook - For Q1 2026, Hilton anticipates net income between $436 million and $450 million, with adjusted EBITDA expected to be between $875 million and $995 million [15] - Full-year 2026 projections include net income of $1.98-$2.01 billion, adjusted EBITDA of $4 billion to $4.04 billion, and adjusted EPS in the range of $8.65-$8.77 [16] - Management expects system-wide RevPAR to increase by 1-2% year-over-year in 2026 [16] Strategic Developments - Hilton launched a new brand, Apartment Collection by Hilton, expected to add up to 3,000 units to its existing apartment-style accommodations [12] - The company continues to expand its luxury and lifestyle portfolio, with notable openings including the Waldorf Astoria Shanghai Qiantan and several Tapestry Collection properties [11]

Core Viewpoint - Hilton Worldwide Holdings Inc. has shown strong stock performance with a 9.25% increase over the past month and a 21.66% increase over the past year, leading to optimism among long-term shareholders [1] Group 1: Stock Performance - The current trading price of Hilton Worldwide Holdings Inc. is $322.00, reflecting a 1.30% increase [1] - Over the past month, the stock has increased by 9.25% [1] - In the past year, the stock has appreciated by 21.66% [1] Group 2: P/E Ratio Analysis - The P/E ratio is a critical metric for investors, comparing the current share price to the company's earnings per share (EPS) [2] - A higher P/E ratio may indicate that investors expect better future performance, but it could also suggest overvaluation [2] - Hilton Worldwide Holdings Inc. has a P/E ratio of 46.98, which is lower than the industry average of 56.82, potentially indicating that the stock may be undervalued or expected to perform worse than peers [3]

Core Viewpoint - Hilton Hotels (HLT.US) is expected to experience significant events and trends in 2026 that may impact its stock performance [1] Financial Performance - In Q3 2025, the company reported a revenue increase of 8.82% year-over-year and a substantial net profit growth of 22.09% [2] - Full-year performance for 2025 is anticipated to be released in early 2026, with investors advised to monitor net unit growth (6.7% achieved in 2025) and whether the strong earnings guidance continues [2] Business Development - In January 2026, Hilton announced reaching a milestone of 1,000 hotels in China and plans to open several key projects in the first half of the year, including Hilton Garden Inn Guangzhou and Hilton Garden Inn Luoyang, to accelerate brand matrix deepening [3] - The group maintains a pace of opening a new hotel every two days, with the Chinese market expected to continue leading in scale [3] Industry Policy and Environment - Analysts indicate that the hotel industry's supply growth is expected to slow in 2026, with occupancy rates in high-tier cities likely to rebound, supporting low single-digit growth in RevPAR (Revenue per Available Room) [4] - This trend may bolster Hilton's pricing power and revenue [4] Institutional Perspectives - In January 2026, several institutions updated their ratings, with Morgan Stanley raising its target price to $306 and Wells Fargo increasing it to $338, reflecting market expectations for fundamental improvements [5] - The current average target price among institutions is approximately $299, with 46% of ratings being overweight [5]

Core Viewpoint - Hilton Worldwide Holdings Inc. reported stronger-than-expected quarterly results, with a focus on steady demand trends and pipeline growth, despite a more measured outlook for the upcoming year [1] Quarterly Analysis - The company reported fourth-quarter adjusted earnings per share of $2.08, exceeding the analyst consensus estimate of $2.02 [2] - Quarterly sales reached $3.087 billion, surpassing the expected $2.987 billion [2] - System-wide comparable RevPAR increased slightly year over year, driven by higher average daily rates, although occupancy saw modest declines [2] - Operating income for the quarter was $602 million, up from $489 million a year ago [3] - Adjusted EBITDA rose to $946 million from $858 million in the previous year [3] - Hilton opened 190 hotels, adding a total of 26,000 rooms, resulting in 21,300 net room additions [3] Development Pipeline - The company added 37,400 rooms to its development pipeline in the fourth quarter, totaling 3,703 hotels as of December 31, 2025 [4] - Nearly half of the rooms in the development pipeline were under construction, with more than half located outside the U.S. [4] - Total cash and equivalents stood at $970 million as of December 31, 2025, including $52 million of restricted cash [4] Outlook - Hilton expects first-quarter GAAP EPS to be in the range of $1.87-$1.93, compared to the $1.78 estimate [5] - The company anticipates first-quarter adjusted EPS of $1.91-$1.97, against an estimate of $1.84 [5] - For fiscal year 2026, GAAP earnings per share are projected to be between $8.49 and $8.61, compared to the $8.76 analyst estimate [5] - Fiscal year 2026 adjusted EPS is expected to be in the range of $8.65 to $8.77, lower than the $9.17 analyst estimate [5]

Company Overview - As of December 31, 2025, Hilton operates 9,158 properties with a total of 1,351,351 rooms across 143 countries and territories[19]. - The total number of hotels in the system includes 46 owned, 873 managed, and 8,239 franchised properties[28]. - The U.S. market accounts for 6,211 hotels with 851,582 rooms, representing a significant portion of Hilton's total[28]. - International operations accounted for approximately 36% of the company's system-wide hotel rooms in 2025, indicating significant reliance on global markets[123]. Hilton Honors Loyalty Program - The Hilton Honors loyalty program has 243 million members, reflecting a 15% increase from December 31, 2024[19]. - The Hilton Honors loyalty program is crucial for customer retention, and any changes to its benefits could adversely affect participation[122]. Financial Performance - Adjusted EBITDA for the year ended December 31, 2025, was $3,725 million, up from $3,420 million in 2024[218]. - Net income for 2025 was reported at $1,461 million, compared to $1,530 million in 2024[218]. - The company reported a loss on foreign currency transactions of $11 million for 2025[218]. - The company’s dividend policy may change at any time, and future dividends are at the discretion of the board of directors based on various factors[160]. Development and Growth - The net unit growth for the year ended December 31, 2025, was 6.7%[22]. - The development pipeline includes 1,073 room additions, with a total of 3,703 rooms counted as of period end, representing a significant expansion of the hotel network[197]. - The company is focused on expanding its global hotel network, with nearly half of the rooms under construction located outside the U.S.[22]. - The company evaluates the economic viability of new hotels based on geographic location and credit quality of third-party owners, aiming to increase revenues and free cash flow over time[195]. Employment and Workplace Recognition - Approximately 182,000 individuals were employed or managed at the company's leased and managed hotels and corporate offices as of December 31, 2025[44]. - The company achieved recognition as the 2025 1 World's Best Workplace by Fortune and Great Place to Work, marking the ninth consecutive year as the top hospitality company[45]. - Approximately 25% of employees globally and 45% of employees in the U.S. are covered by collective bargaining agreements as of December 31, 2025[128]. Risks and Challenges - The company faces risks related to substantial indebtedness and evolving corporate governance regulations, which could impact financial conditions[21]. - The hospitality industry is subject to significant competition from various providers, including major hotel chains and independent operators, impacting market positioning[65]. - Economic conditions significantly influence demand for hotel services, with potential declines in revenue during economic downturns due to fixed operational costs[81]. - The company faces risks related to changes in supply and demand for hotel services, which can affect pricing and revenue generation[79]. - The company is subject to ongoing tax audits, particularly for U.S. federal income tax returns from fiscal years 2011 to 2020, which may result in material increases to income tax liability[148]. Environmental and Compliance Issues - The company focuses on reducing emissions, water, and waste intensity at its hotels, implementing utility cost savings measures[55]. - Compliance with various laws and regulations, including those related to health and safety, can impact operational costs and profitability[72]. - Environmental laws and regulations may impose substantial compliance costs and potential liabilities on the company, affecting operations and financial condition[149]. - The company is subject to various laws and regulations regarding modern slavery and human trafficking, which could increase operational costs and reduce profits[127]. Market Trends and Performance Metrics - The hospitality industry experiences seasonality, with revenues typically lower in the first quarter compared to the subsequent three quarters[67]. - System-wide occupancy rate for the year ended December 31, 2025, was 71.5%, a decrease of 0.1 percentage points compared to 2024[216]. - Average Daily Rate (ADR) increased to $159.89, reflecting a 0.5% increase year-over-year[216]. - Revenue per Available Room (RevPAR) rose to $114.39, marking a 0.4% increase from the previous year[216]. - In the U.S., RevPAR decreased to $121.91, a decline of 0.8% year-over-year, influenced by reduced international travel and macroeconomic uncertainty[216]. Cybersecurity and Technology - The company has adopted a Cybersecurity Policy requiring all employees to report potential cybersecurity incidents immediately and certify their understanding of the policy annually[166]. - The Global Information Security team is responsible for managing cybersecurity risks and is organized into five functional areas, including incident response and governance, risk, and compliance[164]. - Cyber-attacks pose a risk to the company, potentially leading to loss of sensitive information and operational disruptions[107]. - The company relies on third parties for significant information technology functions, and disruptions in these services could adversely affect operations[104]. Financial Obligations and Debt - As of December 31, 2025, the company's total indebtedness was approximately $12.5 billion, with long-term debt maturities of $25 million, $619 million, and $12 million for the years ending December 31, 2026, 2027, and 2028, respectively[151]. - The company has a significant amount of indebtedness that could require a substantial portion of cash flow from operations to be dedicated to debt payments, limiting funds available for operations and capital expenditures[150]. - The company is required to maintain a consolidated secured net leverage ratio not to exceed 5.0 to 1.0 as of the last day of any four consecutive quarters[155].

Financial Data and Key Metrics Changes - For the full year 2025, system-wide RevPAR growth was up 40 basis points year over year, with record adjusted EBITDA of $3.7 billion, up 9% year over year [5][6] - In the Fourth Quarter, system-wide RevPAR increased 50 basis points year-over-year, with adjusted EBITDA at $946 million, up 10% year-over-year [6][15] - The company returned $3.3 billion to shareholders in 2025, the highest total capital return in its history [6] Business Line Data and Key Metrics Changes - Leisure transient RevPAR was up 2.3%, while business transient RevPAR was down 2.1% due to U.S. government shutdown impacts [6][15] - Group RevPAR increased by 2.6%, driven by strong international group growth [6][15] - The company opened nearly 200 hotels in the Fourth Quarter, totaling nearly 26,000 rooms, contributing to a full-year net unit growth of 6.7% [7][8] Market Data and Key Metrics Changes - In the Americas outside the U.S., Fourth Quarter RevPAR increased 3.8% year-over-year, while Europe saw a 5.3% increase, and the Middle East and Africa region experienced a 15.9% increase [16][17] - Asia-Pacific region's Fourth Quarter RevPAR was up 9.2% excluding China, while China saw a decline of 1.4% [17] Company Strategy and Development Direction - The company is focused on expanding its brand portfolio, including the launch of the Apartment Collection by Hilton and Outset Collection, targeting the apartment-style lodging segment [10][12] - The pipeline reached over 520,000 rooms, with expectations for sustained net unit growth of 6%-7% for 2026 and beyond [11][17] - The company aims to enhance its Hilton Honors program, making loyalty more accessible and rewarding [12][13] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for 2026, expecting stronger economic conditions and improved performance in EMEA and APAC regions [7][30] - The CEO highlighted macroeconomic factors such as decreasing inflation and increased investment in technology as positive indicators for future growth [21][25] - Management noted that early 2026 showed positive trends in group bookings and leisure demand, with expectations for RevPAR growth of 1%-2% year-over-year [7][18] Other Important Information - The company was named the number one world's best workplace by Fortune and Great Place to Work for 2025 [13] - The company continues to see strong performance in its luxury and lifestyle brands, with nearly 30% of total openings in the quarter coming from these segments [8][9] Q&A Session Summary Question: Overview of the broader economy and lodging industry - Management expressed optimism about the economy, citing macro and micro forces that are converging positively, including decreasing inflation and a favorable investment environment [21][30] Question: AI and technology partnerships - The company is actively exploring AI applications across its operations and is engaged with major tech players to enhance efficiencies and customer experience [34][41] Question: Growth of lifestyle and luxury brands - Management indicated that as the lifestyle and luxury brands gain scale, they will benefit from network effects, leading to increased market share and profitability [46][49] Question: Development environment and key money usage - The company remains disciplined regarding key money, with a focus on maintaining a competitive edge while managing development costs [53][56] Question: RevPAR guidance and quarterly cadence - Management acknowledged the complexity of the upcoming year but expressed confidence in the guidance range, citing potential upside from events like the World Cup [60][62] Question: EPS growth rate compared to EBITDA growth - Management clarified that EPS growth is impacted by share count and interest expenses, with adjusted EPS growth expected in the low double digits [67][68]