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Omar Venerio
Omar Venerio
Articles (1677) 

Major Indexes Gain More 1.5% in Intraday Trading Thursday

Hyatt Hotels jumps on financial results

U.S. stocks were in the green on Thursday on the back of 3.17 million new unemployment claims for the past week, according to the U.S. Labor Department. The total new jobless claims recorded since the end of March is more than 33 million. In other markets, oil prices rose as investor are confident that the supply cut will even out the weak demand. The Dow Jones Industrial Average gained 1.13% to 23,931, the S&P 500 Index rose 1.33% to 2,886 and the Nasdaq Composite Index advanced 1.45% to 8,982.

Non-index stocks have also posted gains and losses recentlyShares of Hyatt Hotels Corp. (NYSE:H) gained more than 3% on Thursday after the company announced first-quarter results on Wednesday. The hotel chain posted a loss of 35 cents per share, which was 17 cents short of analysts' expectations. Revenue of $993 million declined19.9% year over year, but beat expectations by $18.14 million.

"As COVID-19 became a global pandemic, we took prompt and meaningful actions to manage the first phase of the impact of the virus," President and CEO Mark S. Hoplamazian said. "We obtained substantial additional cash, reduced investment and corporate spending to preserve cash, and we reduced third party hotel owners' direct costs through this period. While we continue to operate in an environment of suppressed demand and great uncertainty, we believe our existing liquidity provides sufficient capacity to cover at least 30 months of operations under current conditions."

Adjusted earnings before interest, taxes, depreciation and amortization decreased by 53.9% to $86 million in constant currency. The adjusted Ebitda margin was 18.3%, a decline of 1,010 basis points.

Further, the comparable system-wide revenue per available room declined 28.1%, including a decrease of 25.8% at comparable owned and leased hotels. Comparable U.S. hotel RevPAR fell 24.5%; with full service hotel RevPAR declining 25.2% and select service hotel RevPAR decreasing 23%. Comparable owned and leased hotels operating margin reached 14.5%, tumbling more than 1,000 basis points.

The company managed its liquidity by suspending all share repurchase activity and its quarterly dividend through the first quarter of 2021. On the balance sheet, cash and cash equivalents reached $1,194 million, with a total debt of $1,962 million.

Several hedge fund managers were active at the end of December. Joel Greenblatt (Trades, Portfolio) initiated a new position of 4,176 shares. Ray Dalio more than doubled his holding to 23,961 shares and Lee Ainslie (Trades, Portfolio) boosted his position by 892% to 423,164 shares. Jim Simons (Trades, Portfolio)'Renaissance Technologies trimmed its holding by 37%to 82,100 shares.

Gainers

Losers

Global markets

The main European stock markets traded in the greenThe U.K.'s FTSE 100 jumped 1.40%, France's CAC 40 advanced 1.54%, Germany's Dax gained 1.44% and Spain's Ibex 35 rose 0.89%.

In Asia, Japan's Nikkei 225 gained 0.28%, India’s BSE Sensex fell 0.76%, Hong Kong's Hang Seng slid 0.65% and China's Shanghai Composite retreated 0.23%.

Disclosure: The author holds no positions in any stocks mentioned.

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About the author:

Omar Venerio
Omar Venerio is a capital markets, derivatives, corporate finance and financial management professor and Area Head of Finance. He is passionate about the stock market and providing independent fundamental research and hedge fund and insider trading-focused investigation.

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