Marriott International, Inc. MAR is scheduled to release fourth-quarter 2022 results on Feb 14, 2023, before the opening bell. In the previous quarter, the company’s earnings matched the Zacks Consensus Estimate of $1.69.

The Trend in Estimate Revision

The Zacks Consensus Estimate for the fourth-quarter bottom line is pegged at $1.84 per share, indicating growth of 41.5% from $1.30 reported in the year-ago quarter.

For revenues, the consensus mark is pegged at $5,612 million, suggesting growth of 26.2% from the prior-year quarter’s reported figure.

Key Factors to Note

Marriot’s fourth-quarter performance is likely to have benefited from robust leisure demand and business and cross-border travel improvements. During the previous-quarter earnings call, the company stated that cross-border guests accounted for 15% of global room nights, up from 12% reported in the first quarter of 2022. Also, it reported a rise in last-minute booking trends, thereby leading to a meaningful compression in pricing power and boosting group ADR for new bookings.

With global trends improving, the recovery momentum is likely to have continued in the fourth quarter. Attributes such as pent-up demand for all types of travel, the shift of spending toward experiences versus goods, sustained high levels of employment and resilient travel spending are likely to have boosted the company’s performance in the to-be-reported quarter.

Increased focus on the Marriott Bonvoy loyalty program bodes well for the company. With nearly 173 million members globally, the company’s loyalty program Marriott Bonvoy is supporting its marketing strategies. The company engages its customers with promotional offers such as grocery and retail spending accelerators on its co-branded credit cards. During the third quarter of 2022, the program reported solid penetration levels of 60% in the United States and Canada and 53% globally. Also, the company reported increased sign-ups following the addition of new benefits to its U.S. cards. Given the meaningful pickup in demand coupled with solid customer acceptance for credit card programs, the momentum is likely to have continued in the fourth quarter.

The Zacks Consensus Estimate for fourth-quarter revenues at base management and franchise fees is pegged at $282 million and $674 million, indicating year-over-year growth of 30% and 29.6%, respectively.

However, coronavirus-induced travel restrictions (in China) and supply chain disruptions are likely to have affected the company’s operations in the third quarter. Although revenue per available room (RevPAR) is likely to have increased sequentially in Greater China and Asia Pacific (excluding China), it is expected to have remained below pre-pandemic levels.

What the Zacks Model Unveils

Our proven model predicts an earnings beat for Marriott this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.

Earnings ESP: Marriott has an Earnings ESP of +1.63%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.