By JP Morgan initiated coverage on Marriott International. The brokerage sees a 9% upside on the hotel company.
Balanced risk profile
The brokerage gave a target price of $284 with a neutral rating. The target price indicates a 9% upside from Friday’s closing price.
JPMorgan has assessed Marriott’s investment profile as balanced, citing the hotel chain’s status as a “high-quality, asset-light compounder” with strong exposure to the higher-end market and customer segments.
While these are considered favorable traits, the investment bank views Marriott’s current valuation—trading at 14.5 times estimated 2026 EV/EBITDA—as already reflecting these strengths.
As a result, it sees limited upside at current levels.
The firm also pointed to Marriott’s valuation discount of 1.5 to 2 times compared to peer Hilton since late 2023.
This gap is attributed to several factors, notably Marriott’s slower average net room growth, estimated at around 5%, versus Hilton’s 6–7%.
Additional contributors to the discount include Marriott’s relatively more asset-heavy structure, with owned EBITDA accounting for approximately 9% of total EBITDA, compared to Hilton’s 5%.
JPMorgan also noted that Marriott’s fee growth has shown some deviation from the typical RevPAR/net room growth correlation, and the company has slightly greater exposure to incentive management fees—15% of total fees versus Hilton’s 9%.
Marriott’s Q1 results
In May, the hotel major reported a quarterly earnings of $2.32 per share, compared to $2.13 per share a year ago.
The company posted $6.26 billion in revenue for the quarter ended March 2025 compared to $5.98 billion in the previous year.
Marriott’s global RevPAR rose by 4.1%. This included a 3.3% increase in the U.S. and Canada, while international markets saw a stronger growth of 5.9%.
During the quarter, Marriott added approximately 12,200 net rooms, representing a 4.6% increase compared to the end of the first quarter of 2024.
By quarter’s end, the company’s global development pipeline included around 3,800 properties and over 587,000 rooms, reflecting a 7.4% year-over-year increase.
After the results, Marriott had declared a quarterly cash dividend of 67 cents per share.
Marriott reported a total of 244,000 rooms currently under construction, including those undergoing conversion, which has shifted the composition of its overall development pipeline.
CEO Anthony Capuano noted a growing trend of consumers delaying hotel bookings, contributing to uncertainty around future reservations.
“The strong momentum in our development activity continued, with record first quarter signings of over 34,000 rooms, of which two-thirds were in international markets. Conversions remained a key driver of growth, representing around a third of our room signings and openings”, Capuano said.
Nonetheless, demand from both leisure and business travelers remains steady, with value-consciousness becoming more pronounced, especially among lower-income customers.
Mariott stock was down 0.26% during the press time. The benchmark S&P 500 index was up 0.50%.
According to TipRanks, out of the 16 analysts rating the stock, 10 gave a hold rating and 6 gave a buy rating.
The consensus target price is $280.19, indicating a more than 8% upside.
Marriott’s stock has fallen by 5% in the year so far.
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