Company Reports

Hilton's US region (about 75% of total sales) is seeing strong demand sparked by higher tax refunds in 2026 and secular investments into artificial intelligence, onshoring manufacturing, and infrastructure, offsetting near-term demand softness in its Middle East business (3%) due to the Iran war. Long term, we see lasting demand and a strengthening brand intangible asset, a source of its wide moat, for Hilton’s strong upper-scale, lifestyle, and luxury portfolio. Its portfolio is expanding, supported by the Small Luxury Hotels of the World partnership in 2024, the emerging premium economy midscale brand Spark, launched in 2023, and the extended-stay offering LivSmart Studios, also new in 2023. As of Dec. 31, 2025, Spark already had 228 hotels open, and we estimate LivSmart had more than 100 hotels in the pipeline. In the long term, Spark has the potential to reach a few thousand units, offering an attractive unit growth catalyst for the company. Also, Hilton launched a midscale lifestyle brand, Outset, in October 2025, with the potential to add 500 properties in North America over the long term.

Hilton's second-quarter revenue per available room, or revPAR, increased 3.9%, ahead of the hotelier's 2%-3% target. Unit and pipeline growth were up 6.1%. Adjusted EBITDA grew 5%. The company increased its 2026 revPAR growth guidance to 3.0%-3.5% from 2%-3%.

Hilton's US region (about 75% of total sales) is seeing strong demand sparked by higher tax refunds in 2026 and secular investments into artificial intelligence, onshoring manufacturing, and infrastructure, offseting near-term demand softness in its Middle East business (3%) due to geopolitical uncertainty. Long term, we see lasting demand and a strengthening brand intangible asset, a source of its wide moat, for Hilton’s strong upper-scale, lifestyle, and luxury portfolio. Its portfolio is expanding, supported by the Small Luxury Hotels of the World partnership in 2024, the emerging premium economy midscale brand Spark, launched in 2023, and the extended-stay offering LivSmart Studios, also new in 2023. As of Dec. 31, 2025, Spark already had 228 hotels open, and we estimate LivSmart had more than 100 hotels in the pipeline. In the long term, Spark has the potential to reach a few thousand units, offering an attractive unit growth catalyst for the company. Also, Hilton launched a midscale lifestyle brand, Outset, in October 2025, with the potential to add 500 properties in North America over the long term.

Hilton's first-quarter revenue per available room, or revPAR, increased 3.6%. Room growth was up a healthy 6.3%. EBITDA margin was 30.7% from 29.5% a year ago, helped by stronger profitability at owned hotels.

We see lasting demand and a strengthening brand intangible asset, a source of its wide moat, for Hilton’s strong upper-scale, lifestyle, and luxury portfolio. The firm's portfolio is expanding, supported by the Small Luxury Hotels of the World partnership in 2024, the emerging premium economy midscale brand Spark, launched in 2023, and the extended-stay offering LivSmart Studios, also new in 2023. As of Dec. 31, 2025, Spark already had 228 hotels open, and we estimate LivSmart had more than 100 hotels in the pipeline. In the long term, Spark has the potential to reach a few thousand units, offering an attractive unit growth catalyst for the company. Also, Hilton launched a midscale lifestyle brand, Outset, in October 2025, with the potential to add 500 properties in North America over the long term.

Hilton's fourth-quarter revenue per available room, or revPAR, increased 0.5%, versus the firm's 1% guidance, hindered by the US government shutdown. Adjusted EBITDA rose 10% on cost and technology efficiencies. Hilton's first-quarter revPAR target is for a 1%-2% increase.

While macroeconomic concerns present near-term risk to travel consumption, we see lasting demand for Hilton’s strong upper-scale, lifestyle, and luxury presence, which is strengthening its brand intangible asset, the primary source of its wide moat. The firm's portfolio is set to expand by about 1,000 hotels in 2025, supported by the Small Luxury Hotels of the World partnership, the emerging premium economy midscale brand Spark, launched in 2023, and the extended-stay offering LivSmart Studios, also new in 2023. As of Sept. 30, 2025, Spark already had 207 hotels open, and we estimate LivSmart had more than 100 hotels in the pipeline. In the long term, Spark has the potential to reach a few thousand units, offering an attractive unit growth catalyst for the company. Also, Hilton launched a midscale lifestyle brand, Outset, in October 2025, with 60 hotels in development and the potential to add 500 properties in North America over the long term.

Hilton's third-quarter revenue per available room dropped 1.1% versus the firm's flat to slightly down target, driven by a 2.3% decrease in the US. Even so, EBITDA of $976 million surpassed the company's guidance by $31 million at the midpoint, helped by cost efficiencies.

While macroeconomic concerns present near-term risk to travel consumption, we see lasting demand for Hilton’s strong upper-scale, lifestyle, and luxury presence, which is strengthening its brand intangible asset, the primary source of its wide moat. The firm's portfolio expanded by several hundred hotels in 2024 with the Small Luxury Hotels of the World partnership and acquisition of a majority interest in the NoMad brand. Hilton's emerging premium economy midscale brand Spark, launched in 2023, extended-stay offering LivSmart Studios, also launched in 2023, and acquisition of Graduate Hotels in 2024 all support its pricing prowess. As of Dec. 31, 2024, Spark already had about 100 hotels open and LivSmart had 75 hotels in the pipeline. Long term, Spark has the potential to reach a few thousand units, offering an attractive unit growth catalyst for the company.

Hilton's second-quarter revenue per available room dropped 0.5%, slightly below the firm's flat target on softer business and group demand. EBITDA of $1.008 billion surpassed the company's guidance by $50 million at the midpoint primarily due to the timing of termination fees and corporate expense.

While macroeconomic concerns present near-term risk to travel consumption, we see lasting demand for Hilton’s strong upper-scale, lifestyle, and luxury presence, which is strengthening its brand intangible asset, the primary source of its wide moat. The firm's portfolio expanded by several hundred hotels in 2024 with the Small Luxury Hotels of the World partnership and acquisition of a majority interest in the NoMad brand. Hilton's emerging premium economy midscale brand Spark, launched in 2023, extended-stay offering LivSmart Studios, also launched in 2023, and acquisition of Graduate Hotels in 2024 all support its pricing prowess. As of Dec. 31, 2024, Spark already had about 100 hotels open and LivSmart had 75 hotels in the pipeline. Long term, Spark has the potential to reach a few thousand units, offering an attractive unit growth catalyst for the company.

Amid ambiguous economic conditions, Hilton's first-quarter revenue per available room, or revPAR, increased 2.5%, at the low end of 2.5%-3.5% guidance. As such, the hotelier lowered its 2025 revPAR outlook to flat-2% growth from 2%-3%.

We see lasting demand for Hilton’s strong upper-scale, lifestyle, and luxury presence, which is strengthening its brand intangible asset, the primary source of its wide moat. The firm's portfolio expanded by several hundred hotels in 2024 with the Small Luxury Hotels of the World partnership and acquisition of a majority interest in the NoMad brand. Hilton's emerging premium economy midscale brand Spark, launched in 2023, extended-stay offering LivSmart Studios, also launched in 2023, and acquisition of Graduate Hotels in 2024 all support its pricing prowess. As of Dec. 31, 2024, Spark already had about 100 hotels open and LivSmart had 75 hotels in the pipeline. Long term, Spark has the potential to reach a few thousand units, offering an attractive unit growth catalyst for the company.

Hilton posted solid fourth-quarter revenue per available room, or revPAR, growth of 3.5% versus its 1%-2% guidance, driven by broad customer and regional strength. Additionally, Hilton is incrementally more constructive on the economic backdrop and sees revPAR increasing 2%-3% in 2025. We plan to increase our 2025 revPAR estimate to 3.0% from 2.5%, while maintaining our 5.0%-5.5% growth forecast for 2026-28. We expect to lift our $214 per share fair value estimate by a mid-single-digit percentage, implying a 16 times 2025 EV/EBITDA multiple. We remain steadfast that Hilton has among the industry’s strongest brands, source of its wide moat. That said, at a 20 times forward EV/EBITDA multiple we believe investors are factoring revPAR above the US upscale long-term average growth rate of 3%-4% over an extended period beyond a historical upcycle of several years.

We have increased our 2026-28 revenue per available room, or revPAR, forecast for wide-moat Hilton to an average annual growth rate of 5.3% from 3.5%, as our research shows the US industry can post strong increases despite reduced savings rates and elevated inflation. We have lifted Hilton’s fair value estimate to $214 per share (representing a 15 times 2025 EV/adjusted EBITDA) from $185. Despite our expanded valuation, we see shares as overvalued. But we wouldn’t need much discount to recommend shares of this brand advantaged wide-moat company.

Despite waning US savings rates, we see lasting demand for Hilton’s strong upper scale, lifestyle, and luxury presence, which is strengthening its brand intangible asset, the primary source of its wide moat. The firm's portfolio is expanding by several hundred hotels with its February 2024 Small Luxury Hotels partnership and its April 2024 acquisition of a majority interest in the Nomad brand. Hilton's emerging midscale brand (Spark by Hilton, launched in 2023); its extended-stay offering that it also launched in 2023 (LivSmart Studios); and the acquisition of Graduate Hotels in 2024, all support its pricing prowess. In fact, both Hilton's premium economy/midscale brand Spark and extended-stay concept LivSmart already have a few hundred partners in negotiations to join the company's portfolio. Long term, Spark has the potential to reach a few thousand units, offering an attractive unit growth catalyst for the company.

While the travel industry faces some near-term moderation in demand, Hilton’s strong upper scale, lifestyle, and luxury presence are strengthening its brand intangible asset, the primary source of its wide moat. The firm's portfolio is expanding by several hundred hotels with its February 2024 Small Luxury Hotels partnership and its April 2024 acquisition of a majority interest in the Nomad brand. Hilton's emerging midscale brand (Spark by Hilton, launched in 2023); its extended-stay offering that it also launched in 2023 (LivSmart Studios); and the acquisition of Graduate Hotels in 2024, all support its pricing prowess. In fact, both Hilton's premium economy/midscale brand Spark and extended-stay concept LivSmart already have a few hundred partners in negotiations to join the company's portfolio. Long term, Spark has the potential to reach a few thousand units, offering an attractive unit growth catalyst for the company.

Wide-moat Hilton’s third-quarter revenue per available room growth of 1.4% missed the hotelier’s target of 2%-3%, and the firm lowered its 2024 revPAR growth guidance to 2%-2.5% from 2%-3%. It appears revPAR was affected by an unexpected slower macroenvironment and adverse weather. Still, we don’t plan to adjust our 2.5% 2024 revPAR growth forecast, as we see signs of demand health in Hilton’s business that we believe will allow it to match our 2.5% increase modeled for wide-moat peer InterContinental. We don’t plan to change our $180 fair value estimate materially. But trading at 18 times forward enterprise value/EBITDA, versus about 14 times before the pandemic, the shares of this leading hotel brand appear overvalued to us.

While the travel industry faces some near-term softness in demand, Hilton’s strong upper scale, lifestyle, and luxury presence are strengthening its brand intangible asset, the primary source of its wide moat. The firm's portfolio is expanding by several hundred hotels with its February 2024 Small Luxury Hotels partnership and its April 2024 acquisition of a majority interest in the Nomad brand. Hilton's emerging midscale brand (Spark by Hilton, launched in 2023); its extended-stay offering that it also launched in 2023 (LivSmart Studios); and the acquisition of Graduate Hotels in 2024, all support its pricing prowess. In fact, both Hilton's premium economy/midscale brand Spark and extended-stay concept LivSmart already have a few hundred partners in negotiations to join the company's portfolio. Long term, Spark has the potential to reach a few thousand units, offering an attractive unit growth catalyst for the company.

We don’t plan to meaningfully change Hilton’s $182 fair value estimate, as some near-term softening in industry travel demand is offset by stronger development growth. Trading at 18 times forward enterprise value/EBITDA, versus about 15 times prepandemic, we see shares as overvalued, but wouldn’t require much discount to our valuation to recommend an investment in this leading hotel brand (primary source of its wide moat).