Company Reports

After announcing Dominic Dragisich as interim CEO on May 20, replacing Pat Pacious, Choice announced on Aug. 31 that he would permanently take the role. Dragisich has held the chief financial, strategy, and brand officer roles at the hotelier.

With about 90% of Choice Hotels' US portfolio within one mile of an interstate, the company is positioned to benefit from US AI, onshoring, and infrastructure activity. Also, 2026 demand is helped by easier comparisons (2025's government shutdown and the April 2 tariffs) and the tailwinds of this year's FIFA World Cup and US economic stimulus. Long term, we expect Choice to gradually expand room share in the hotel industry in the next decade, with its keys increasing more than 2% on average annually, above the 1%-2% supply lift we estimate for the US industry over that time. Room growth points to higher quality units, as Choice's pipeline is expected to generate revenue that is on average 70% above its existing base, and the company removed rooms in 2025 that produced 20% less revenue than the consolidated average. The expansion of its higher-scale and extended-stay portfolio stands to buoy the company’s brand intangible asset and switching cost advantages. Specifically, growth is supported by a rejuvenated Comfort brand (27% of 2025 total global rooms), the newer Everhome concept and extended-stay brand WoodSpring (6% combined), the acquisition of the higher-scale Radisson brand in 2022, new Canada and China franchise relationships in 2025, and a solid loyalty program with 74 million members as of Dec. 31, 2025, up from 44 million in 2019. Choice holds a 1.6% global hotel revenue share, ranking it eighth in the industry, and 5.6% US share, ranking it fourth in the industry.

Choice's second-quarter revenue per available room, or revPAR, increased 1.7%. Room growth was 2.6%. Adjusted EBITDA grew 6.0%. RevPAR guidance increased to 0%-1% from a range of down 2% to up 1%, and unit growth guidance rose to 1.5% from 1.0% for 2026, driven by the US.

With about 90% of Choice Hotels' US portfolio within one mile of an interstate, the company is positioned to benefit from US AI, onshoring, and infrastructure activity. Also, 2026 demand should be helped by easier comparisons (2025's government shutdown and the April 2 tariffs) and the tailwinds of this year's FIFA World Cup and US economic stimulus. Long term, we expect Choice to gradually expand room share in the hotel industry in the next decade, with its keys increasing more than 2% on average annually, above the 1%-2% supply lift we estimate for the US industry over that time. Room growth points to higher quality units, as Choice's pipeline is expected to generate revenue that is on average 70% above its existing base, and the company removed rooms in 2025 that produced 20% less revenue than the consolidated average. The expansion of its higher-scale and extended-stay portfolio stands to buoy the company’s brand intangible asset and switching cost advantages. Specifically, growth is supported by a rejuvenated Comfort brand (27% of 2025 total global rooms), the newer Everhome concept and extended-stay brand WoodSpring (6% combined), the acquisition of the higher-scale Radisson brand in 2022, new Canada and China franchise relationships in 2025, and a solid loyalty program with 74 million members as of Dec. 31, 2025, up from 44 million in 2019. Choice holds a 1.6% global hotel revenue share, ranking it eighth in the industry, and 5.6% US share, ranking it fourth in the industry.

On May 20, Choice announced that Patrick Pacious would step down as CEO after serving in the role since 2017. Dominic Dragisich, the company's chief growth and strategy officer, has been named the interim CEO, as the Board of Directors conducts a search for a permanent leader.

With about 90% of Choice Hotels' US portfolio within one mile of an interstate, the company is positioned to benefit from US AI, onshoring, and infrastructure activity. Also, 2026 demand should be helped by easier comparisons (2025's government shutdown and the April 2 tariffs) and the tailwinds of this year's FIFA World Cup and US economic stimulus. Long term, we expect Choice to gradually expand room share in the hotel industry in the next decade, with its keys increasing more than 2% on average annually, above the 1%-2% supply lift we estimate for the US industry over that time. Room growth points to higher quality units, as Choice's pipeline is expected to generate revenue that is on average 70% above its existing base, and the company removed rooms in 2025 that produced 20% less revenue than the consolidated average. The expansion of its higher-scale and extended-stay portfolio stands to buoy the company’s brand intangible asset and switching cost advantages. Specifically, growth is supported by a rejuvenated Comfort brand (27% of 2025 total global rooms), the newer Everhome concept and extended-stay brand WoodSpring (6% combined), the acquisition of the higher-scale Radisson brand in 2022, new Canada and China franchise relationships in 2025, and a solid loyalty program with 74 million members as of Dec. 31, 2025, up from 44 million in 2019. Choice holds a 1.6% global hotel revenue share, ranking it eighth in the industry, and 5.6% US hotel revenue share, ranking it fourth in the industry.

Choice's first-quarter revenue per available room, or revPAR, decreased 0.8%, with the US down 2.5%. Unit growth increased 1.7%. Adjusted EBITDA decreased 3% on timing of general expenses.

With about 90% of Choice Hotels' US portfolio within one mile of an interstate, the company is positioned to benefit from US infrastructure and onshoring activity. Also, 2026 demand should be helped by easier comparisons (2025's government shutdown and the April 2 tariffs) and the tailwinds of this year's FIFA World Cup and US economic stimulus. Long term, we expect Choice to gradually expand room share in the hotel industry in the next decade, with its keys increasing more than 2% on average annually, above the 1%-2% supply lift we estimate for the US industry over that time. Room growth points to higher quailty units, as Choice's pipeline is expected to generate revenue that is on average 70% above its existing base, and the company removed rooms in 2025 that produced 20% less revenue than the consolidated average. The expansion of its higher-scale and extended-stay portfolio stands to buoy the company’s brand intangible asset and switching cost advantages. Specifically, growth is supported by a rejuvenated Comfort brand (27% of 2025 total global rooms), the newer Everhome concept and extended-stay brand WoodSpring (6% combined), the acquisition of the higher-scale Radisson brand in 2022, new Canada and China franchise relationships in 2025, and a solid loyalty program with 74 million members as of Dec. 31, 2026, up from 44 million in 2019. Choice holds a 1.6% global hotel revenue share, ranking it eighth in the industry, and 5.6% US hotel revenue share, ranking it fourth in the industry.

Choice's fourth-quarter revenue per available room, or revPAR, decreased 4.6%, driven by a 7.6% decline in the US. Despite 12.5% unit growth overseas, total rooms rose just 0.5%, due to a 2.9% drop in the US, where some underperforming units were removed. Adjusted EBITDA was up 6% in 2025.

With about 90% of Choice Hotels' US portfolio within one mile of an interstate, the company is positioned to benefit from US infrastructure and onshoring activity even as near-term demand is hindered by US tariff policy uncertainty. Long term, we expect Choice to gradually expand room share in the hotel industry in the next decade, with its keys increasing more than 2% on average annually, above the 1%-2% supply lift we estimate for the US industry over that time. This growth is supported by a rejuvenated Comfort brand (26% of 2024 total domestic rooms), newer Cambria, Ascend, and Everhome concepts (10% combined), extended-stay brand WoodSpring (6%), the acquisition of the higher-scale Radisson brand in 2022, the partnership with upscale Westgate resorts in 2024 (about 3%), new Canada and China franchise relationships in 2025, and a solid loyalty program with 73 million members as of Sept. 30, 2025, up from 44 million in 2019.

Choice's third-quarter revenue per available room, or revPAR, increased 0.2% globally, with US economic uncertainty leading to a 3.2% decrease in the region, while its international business grew 9.5%. EBITDA was up 9% on mix and non-revPAR partnership revenue fee growth of 19%.

With about 90% of Choice's US portfolio within one mile of interstates, the company is positioned to benefit from US infrastructure and onshoring activity even as near-term demand is hindered by tariff policy uncertainty. Long term, we expect Choice Hotels to gradually expand room share in the hotel industry in the next decade, with its keys increasing more than 2% on average annually, above the 1%-2% supply lift we estimate for the US industry during that time. This growth is supported by a rejuvenated Comfort brand (26% of 2024 total domestic rooms), newer Cambria, Ascend, and Everhome concepts (10% combined), its extended-stay brand WoodSpring (6%), the acquisition of the higher-scale Radisson brand in 2022, the partnership with upscale Westgate resorts in 2024 (about 3%), new Canadian and China franchise relationships in 2025, and a solid loyalty program with 72 million members as of June 30, 2025, up from 44 million in 2019. The company was seeing healthy portfolio growth from its extended-stay brands prior to the coronavirus outbreak, and this demand should continue with the onshoring and infrastructure rebuilding in the US during the next several years, benefiting Choice's 5,000 hotels within a mile of a US interstate. Also, Radisson should increase Choice's mix of upscale and midscale hotels, and generate room night revenue above the consolidated average. The expansion of its higher-scale and extended-stay portfolio stands to buoy its brand intangible asset and switching cost advantages. Overall, Choice holds around 2% global hotel revenue share, ranking it seventh in the industry.

Choice Hotels' US revenue per available room decreased 2.9% in the second quarter. Global room growth was 2.1%, and adjusted EBITDA increased 2%. Amid US consumer spending uncertainty, the firm lowered its 2025 domestic revPAR growth estimate to negative 3% to 0% from negative 1% to 1%.

With about 90% of Choice's US portfolio within 1 mile of interstates, the company is positioned to benefit from any industry trade-down if economic growth slows due to tariff uncertainty. Long term, we expect Choice Hotels to gradually expand room share in the hotel industry in the next decade, with its keys increasing 2% on average annually, above the 1%-2% supply lift we estimate for the US industry during that time. This growth is supported by a rejuvenated Comfort brand (26% of 2024 total domestic rooms), newer Cambria, Ascend, and Everhome concepts (10% combined), its extended-stay brand WoodSpring (6%), the acquisition of the higher-scale Radisson brand in 2022, the partnership with upscale Westgate resorts in 2024 (about 3%), and a solid loyalty program with 69 million members as of Dec. 31, 2024, up from 44 million in 2019. The company was seeing healthy portfolio growth from its extended-stay brands prior to the coronavirus outbreak, and this demand should continue with the onshoring and infrastructure rebuilding in the US during the next several years, benefiting Choice's 5,000 hotels within a mile of a US interstate. Also, Radisson should increase Choice's mix of upscale and midscale hotels, and generate room night revenue above the consolidated average. The expansion of its higher-scale and extended-stay portfolio stands to buoy its brand intangible asset and switching cost advantages. Overall, Choice holds around 2% global hotel revenue share, ranking it seventh in the industry.

Choice's US revenue per available room, or revPAR, and room growth both rose 2.3% in the first quarter. Extended-stay and economy segments led, with RevPAR up 6.8% and 7.1%, respectively. Amid consumer spending uncertainty, the firm lowered 2025 revPAR to (1)%-1% from 1%-2% prior.

Despite waning consumer savings and elevated inflation expectations, we expect Choice Hotels to gradually expand room share in the hotel industry in the next decade, with its keys increasing 2% on average annually, above the 1%-2% supply lift we estimate for the US industry during that time. This growth is supported by a rejuvenated Comfort brand (26% of 2024 total domestic rooms), newer Cambria, Ascend, and Everhome concepts (10% combined), its extended-stay brand WoodSpring (6%), the acquisition of the higher-scale Radisson brand in 2022, the partnership with upscale Westgate resorts in 2024 (about 3%), and a solid loyalty program with 69 million members as of Dec. 31, 2024, up from 44 million in 2019. The company was seeing healthy portfolio growth from its extended-stay brands prior to the coronavirus outbreak, and this demand should continue with the onshoring and infrastructure rebuilding in the US during the next several years, benefiting Choice's 5,000 hotels within a mile of a US interstate. Also, Radisson should increase Choice's mix of upscale and midscale hotels, and generate room night revenue above the consolidated average. The expansion of its higher-scale and extended-stay portfolio stands to buoy its brand intangible asset and switching cost advantages. Overall, Choice holds around 2% global hotel revenue share, ranking it seventh in the industry.

We plan to increase our $113 fair value estimate for narrow-moat Choice Hotels by a high-single-digit percentage to reflect a more constructive intermediate-term outlook. Our 2026-28 estimate for revenue per available room moves up to 4.2% on average from 3.4%. Even after factoring in this change, though, the shares strike us as rich.

While the coronavirus had a material impact on Choice's 2020 demand, the company's US leisure-based portfolio (which represents around 70% of nights) saw a full return to 2019 revenue per available room levels in 2021. Although near-term demand is under pressure due to waning consumer savings, we expect the narrow-moat company to gradually expand room share in the hotel industry in the next decade, with its keys increasing 2% on average annually, above the 1%-2% supply lift we estimate for the US industry during that time. This growth is supported by a rejuvenated Comfort brand (27% of 2023 total domestic rooms), newer Cambria, Ascend, and Everhome concepts (7% combined), its extended-stay brand WoodSpring (6%), the acquisition of the Radisson brand in 2022, and a solid loyalty program with 68 million members as of Sept. 30, 2024, up from 44 million in 2019. Overall, Choice holds around 2% global hotel revenue share, ranking it sixth in the industry.

We plan to increase our $110 per share fair value estimate for narrow-moat Choice by a low-single-digit percentage to account for stronger 2024 revenue per available room, or revPAR, and unit growth. We see shares as overvalued.

While the coronavirus had a material impact on Choice's 2020 demand, the company's US leisure-based portfolio (which represents around 70% of nights) saw a full return to 2019 revenue per available room levels in 2021. Although near-term demand is under pressure due to waning consumer savings, we expect the narrow-moat company to gradually expand room share in the hotel industry in the next decade, with its keys increasing 2% on average annually, above the 1%-2% supply lift we estimate for the US industry during that time. This growth is supported by a rejuvenated Comfort brand (27% of 2023 total domestic rooms), newer Cambria, Ascend, and Everhome concepts (7% combined), its extended-stay brand WoodSpring (6%), the acquisition of the Radisson brand in 2022, and a solid loyalty program with 66 million members as of June 30, 2024, up from 44 million in 2019. Overall, Choice holds around 2% global hotel revenue share, ranking it sixth in the industry.