WYNDHAM WORLDWIDE (New York symbol WYN; www.wyndhamworldwide.com) is one of the world’s largest hospitality companies, with 7,440 franchised hotels worldwide. Its business originated with the Howard Johnson and Ramada chains which opened their first hotels in 1954. The company subsequently added such well-known brands as Days Inn, Super 8, Knights Inn and Travelodge hotels. In addition to hotels, Wyndham Worldwide manages vacation resorts, rental properties, luxury clubs and time-shares. The company now has over 106,000 vacation rental properties in 100 countries. In the three months ended September 30, 2013, Wyndham’s revenue rose 12.8%, to $1.43 billion from $1.27 billion a year earlier. The company gets most of its revenue from vacation rather than business travel, and vacation bookings rose in the latest quarter. That helped push up its occupancy rate by 1.9%.
Investing in stocks: Wyndham spends heavily on online booking systems and expansion to spur new growth
Before one-time items, Wyndham’s earnings rose 24.8%, to $1.41 a share from $1.13. The company continues to buy back its stock. In the latest quarter, it repurchased 2.7 million shares for $160 million. In 2012, it bought back 12.9 million shares for $623 million. To further boost sales, Wyndham has spent heavily on its online booking systems. It’s also expanding its operations in growing markets like Asia and Latin America. Early this year, the company increased its quarterly dividend by 26.1%, to $0.29 a share from $0.23. The shares now yield 1.7%. The stock is hitting all-time highs. In the latest edition of Stock Pickers Digest, we examine Wyndham’s prospects for growth beyond 2013. We also look at its earnings outlook and whether the shares can continue to reach new highs. We conclude with our clear buy-hold-sell advice on the stock. (Note: If you are a current subscriber to Stock Pickers Digest, please click here to view Pat’s recommendation. Be sure to log in first.) COMMENTS PLEASE—Share your investment knowledge and opinions with fellow TSINetwork.ca members When stocks you own have risen to new highs, have you been more likely to hold your winning shares in hopes of further gains, or to sell at least part of them in order to lock in profits? Are there any specific benchmarks you use to make that decision, or do you go more by gut instinct? Have you usually made the right decision?
