Choice Hotels International (NYSE:CHH) Posts Quarterly Earnings Results, Misses Expectations By $0.24 EPS
by Scott Moore · The Cerbat GemChoice Hotels International (NYSE:CHH – Get Free Report) released its earnings results on Thursday. The company reported $1.07 EPS for the quarter, missing the consensus estimate of $1.31 by ($0.24), Zacks reports. Choice Hotels International had a return on equity of 541.07% and a net margin of 23.17%.The firm had revenue of $340.58 million during the quarter, compared to analyst estimates of $331.00 million. During the same quarter last year, the business posted $1.34 EPS. The firm’s revenue was up 2.3% on a year-over-year basis. Choice Hotels International updated its FY 2026 guidance to 6.920-7.140 EPS.
Here are the key takeaways from Choice Hotels International’s conference call:
- U.S. room growth is inflecting — gross openings were up ~32% YoY, conversions accelerated (≈60% of franchise agreements this quarter expected to open this year) and Extended Stay now represents >40% of the U.S. pipeline.
- Franchisee unit economics are improving — U.S. average royalty rate expanded 11 bps, Choice Privileges tops 75M members with loyalty contribution +300 bps in March, and small/mid‑business and group revenues rose materially.
- Capital intensity is declining — Q1 development outlays fell 51% YoY, full‑year net capital outlays are guided to ~$20–45M (about 70% lower at the midpoint vs. 2025), and management plans $175–225M of share repurchases in 2026.
- Near‑term earnings were pressured — Q1 adjusted EPS fell to $1.07 from $1.34 and adjusted EBITDA was $126M (vs. $130M) due to SG&A timing and a temporary tax adjustment, contributing to a weaker short‑term print despite maintained full‑year guidance.
- Technology/AI is a differentiator — a cloud‑native platform (AWS/Salesforce partnerships) and tools like EasyBid have cut group RFP response ~30% and boosted conversion ~250 bps, supporting higher franchisee returns and royalty expansion.
Choice Hotels International Price Performance
Shares of NYSE CHH traded down $17.83 during midday trading on Thursday, hitting $99.53. The company had a trading volume of 2,132,839 shares, compared to its average volume of 679,682. The company has a quick ratio of 0.87, a current ratio of 0.87 and a debt-to-equity ratio of 10.52. The business has a 50-day simple moving average of $107.07 and a two-hundred day simple moving average of $101.47. Choice Hotels International has a twelve month low of $84.04 and a twelve month high of $136.45. The firm has a market capitalization of $4.55 billion, a price-to-earnings ratio of 12.57, a price-to-earnings-growth ratio of 5.25 and a beta of 0.74.
Choice Hotels International Dividend Announcement
The business also recently disclosed a quarterly dividend, which was paid on Wednesday, April 15th. Investors of record on Wednesday, April 1st were paid a $0.2875 dividend. The ex-dividend date was Wednesday, April 1st. This represents a $1.15 annualized dividend and a dividend yield of 1.2%. Choice Hotels International’s dividend payout ratio (DPR) is 14.52%.
Insider Activity
In other Choice Hotels International news, SVP Simone Wu sold 8,080 shares of the firm’s stock in a transaction dated Monday, February 2nd. The shares were sold at an average price of $101.56, for a total transaction of $820,604.80. Following the completion of the transaction, the senior vice president directly owned 48,803 shares in the company, valued at approximately $4,956,432.68. This trade represents a 14.20% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which can be accessed through this link. Also, CFO Scott E. Oaksmith sold 1,603 shares of the firm’s stock in a transaction dated Wednesday, March 18th. The shares were sold at an average price of $100.00, for a total transaction of $160,300.00. Following the transaction, the chief financial officer owned 37,172 shares of the company’s stock, valued at $3,717,200. This trade represents a 4.13% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold a total of 10,283 shares of company stock valued at $1,040,947 over the last 90 days. 23.78% of the stock is currently owned by insiders.
Hedge Funds Weigh In On Choice Hotels International
Several hedge funds have recently added to or reduced their stakes in the business. Wellington Management Group LLP increased its holdings in Choice Hotels International by 55.1% during the 4th quarter. Wellington Management Group LLP now owns 574,630 shares of the company’s stock valued at $54,739,000 after acquiring an additional 204,146 shares in the last quarter. Goldman Sachs Group Inc. increased its holdings in Choice Hotels International by 151.5% during the 4th quarter. Goldman Sachs Group Inc. now owns 512,628 shares of the company’s stock valued at $48,833,000 after acquiring an additional 308,771 shares in the last quarter. Geode Capital Management LLC increased its holdings in Choice Hotels International by 1.5% during the 4th quarter. Geode Capital Management LLC now owns 431,916 shares of the company’s stock valued at $41,151,000 after acquiring an additional 6,422 shares in the last quarter. Bank of America Corp DE increased its holdings in Choice Hotels International by 5.3% during the 2nd quarter. Bank of America Corp DE now owns 428,285 shares of the company’s stock valued at $54,341,000 after acquiring an additional 21,631 shares in the last quarter. Finally, Balyasny Asset Management L.P. increased its holdings in Choice Hotels International by 57.6% during the 2nd quarter. Balyasny Asset Management L.P. now owns 315,969 shares of the company’s stock valued at $40,090,000 after acquiring an additional 115,472 shares in the last quarter. 65.57% of the stock is currently owned by hedge funds and other institutional investors.
Analysts Set New Price Targets
Several analysts recently commented on CHH shares. Morgan Stanley raised their price objective on shares of Choice Hotels International from $83.00 to $87.00 and gave the company an “underweight” rating in a research note on Friday, April 10th. Weiss Ratings upgraded shares of Choice Hotels International from a “sell (d+)” rating to a “hold (c-)” rating in a research note on Monday, February 9th. UBS Group reduced their price objective on shares of Choice Hotels International from $120.00 to $118.00 and set a “neutral” rating for the company in a research note on Wednesday, January 7th. JPMorgan Chase & Co. raised their price objective on shares of Choice Hotels International from $109.00 to $117.00 and gave the company a “neutral” rating in a research note on Tuesday, April 21st. Finally, Jefferies Financial Group cut shares of Choice Hotels International from a “strong-buy” rating to a “hold” rating in a research note on Monday, January 12th. Two equities research analysts have rated the stock with a Buy rating, eight have issued a Hold rating and four have assigned a Sell rating to the stock. According to data from MarketBeat.com, the stock presently has an average rating of “Reduce” and a consensus target price of $112.25.
Read Our Latest Research Report on CHH
Choice Hotels International Company Profile
Choice Hotels International, Inc is a hospitality franchisor specializing in the development and support of lodging brands across the economy, midscale and upscale segments. Through a network of franchisees, Choice Hotels supplies proprietary reservation and distribution systems, comprehensive marketing programs, and operational support services. The company’s core activities include brand management, franchise development, and technology-driven revenue optimization tools designed to enhance guest acquisition and retention for its partners.
Founded in 1939 as Quality Courts United, the company rebranded to Choice Hotels International in 1982 to reflect its expanding brand portfolio and global ambitions.