I need to go on vacation!
Holiday Inn parent IHG is giving $1 billion back to investors because hotels are popular again
IHG’s really good year is also really good for investors
By Laura Bratton, Quartz Media
Feb 20, 2024
Holiday Inn’s parent company InterContinental Hotels Group (IHG) did very well last year — so well that its revenue per room (a measure of success in the hotel world) was up 11% from 2019.
Most of that prosperity can be linked to China’s economy reopening in 2023. IHG’s revenues in China climbed an eye-popping 72% last year compared to 2022.
IHG’s really good year is also really good for investors. The company’s CEO, who took over in July, said the company expects to return more than $1 billion to shareholders in 2024 through its share buyback program and ordinary dividends.
IHG owns a suite of 19 hotel brands — from the best-known Holiday Inn hotels to Iberostar Beachfront Resorts, InterContinental, Regent, Candlewood Suites, Garner, and a lot more. The company has about 6,300 hotels in over 100 countries.
IHG’s stock soared 8% to $105.53 after the news. Other big hotel brands — Hilton, Marriott, and Wyndham — also had positive news for investors over the last couple of weeks as travel demand has recovered from the pandemic.
IHG is the stock market winner
While Airbnb’s recent earnings report was positive, the company’s growth is slowing. Its shares have risen 10% year-to-date but tumbled in the last week.
Meanwhile, IHG’s stock has surged 16% and continues to climb at a faster rate than other hotel brands and Airbnb.
Wyndham shares have remained flat, slightly down from the beginning of the year. Hilton and Marriott shares are both up 9.5% year-to-date, still much less than IHG’s.
Hotels v. Airbnb: Mutual success
Revenues grew for big brands IHG, Hilton, and Marriott in the fourth quarter, while sales stagnated for Wyndham (which is more similar to IHG in market cap and share price than industry mega-giants Hilton and Marriott).
Airbnb, disruptor of the hotel industry, is no exception to the good tidings brought by post-pandemic travel. The company reported a revenue boost of 17% in the fourth quarter of 2023 compared to 2022.