This listing has been discontinued. Please view the following links for our work on Hotels & Gaming stocks:
Gaming & Hotels: BYD, CHDN, HLT, LVS, MAR, MGM, PENN, PNK, WYNN
Structure of the Hotels Industry
The hotels industry is highly competitive, with over 900 lodging management companies in the US alone. Demand for hotel rooms is very cyclical, and fluctuations in both occupancy rates and revenue per available room (RevPAR) should be expected. Firms deal with the concept of perishable inventory, which tends to create pricing pressure in order to attract customers to meet fixed costs. Aggressive online marketing methods by Internet travel intermediaries can also hurt performance. Brand recognition and location are areas of competitive advantages, but we don’t like the space.