Choice Hotels In the early 2000s, Choice Hotels shifted to their focus to extended stay hotels. By offering extended stay to customers, Choice Hotels saw this as an opportunity for maintaining hotel occupancy and an increase in profits. There was a need for more extended stay hotels and Choice
Hotels delivered. In December 2017, Choice Hotels acquired WoodSpring SuitesSM. “The acquisition will add nearly 240 extended-stay hotels in 35 states to the Choice Hotels portfolio, creating an extended-stay portfolio of more than 350 properties with existing brands, MainStay Suites® and Suburban Extended Stay®,” (International, 2018). Extended stay hotels could prove to be a risky investment, but Choice Hotels appears to have avoided that risk for now. In fact, Choice Hotels credits extended stay with the success it has been having during the Corona Virus. “For the month of March, Choice Hotels' extended stay brands achieved an average occupancy level of over 68%, compared to the U.S. hotel industry average of approximately 40%”, (Hospitality Net, 2020). Hospital Net also added that extended stay brands also outperformed on RevPAR from March and April, (2020).
Over the past three years, Choice Hotels treasury stock continues to improve. “Choice Hotels International Inc's treasury stock during the quarter ended September 30th, 2020 of -$1.26 Billion was higher than its peers in the Lodging industry group during the quarter ended December 31st, 2020 of -1.55 Billion,” (DiscoverCI LLC, 2020)
Marriott Marriott’s approach to business growth has changed over the years to keep up with current trends. Compared to Choice Hotels, Marriott seems to focus short-term, rather than long-term for
their business approach. A recent goal was to reach the Millennial generation since that generation is traveling more. In spring 2019, Marriott Homes & Villas was introduced to compete with Airbnb. This luxury alternative to a hotel room faired well against the Corona Virus. “This summer has been highest in gross revenue since launch, with bookings up by 700% over last summer, and revenue increasing by more than 800%,” (Rosenbaum & Sheng, 2020). The Marriott Homes & Villas has helped offset some of the cost to the hotel side due to the Corona Virus. Marriott does not always make sound business decisions. In 2019, Marriott had several acquisitions and dispositions take place. According to the 10-K report, “the acquisition of Elegant Hotels Group plc (“Elegant”) for $128 million in cash and assumed Elegant’s net debt outstanding of $63 million,” (United States Securities and Exchange Commission, 2020). These acquisitions put Marriott into the negative more at -$394,-1.88% in 2019. Nearly 0.20% change from 2018 which was-$340, -1.64%. Over the last three years, like Choice Hotels, Marriott too has seen a steady decrease in treasury stock purchases. Marriott shares outstanding for the quarter ending September 30, 2020 were 0.327B, a 1.71% decline year-over-year.
