Starwood Hotels & Resorts Worldwide (HOT)
Starwood Hotels & ResortsWorldwide (HOT)Christopher Whittelsey, Harvard
Starwood Hotels & Resorts Worldwide (HOT)Mkt Cap: 12.2B*Price (Feb 13): 62.03*Price Target: 80.33 in 1 yearTable of ContentsSummary3SWOT AnalysisPorter's Five Forces45The CompanyBrrands7Growth4 Key Levers to Drive ValuePipeline131821DCF ModelEPS ModelBy Parts ModelConclusion2426283031ValuationRisks
Starwood Hotels & Resorts Worldwide (HOT)Mkt Cap: 12.2B*Price (Feb 13): 62.03*Price Target: 80.33 in 1 yearCompany DescriptionStarwood Hotels & Resorts Worldwide (HOT) is a global hotel and leisure company. Starwood hasiconic brands that resonate with travelers globally and represent a significant share of the luxurylodging industry. They both own & operate as well as lease. They have over 1100 propertiesrepresenting over 330,000 rooms in over 100 countries. Starwood seeks to be the premier luxuryhotel destination while maintaining an asset light operationInvestment Thesis*Starwood is undervalued by approximately30% according to my three valuationmodels.*Starwood has beat analyst expectationsevery quarter since Q1 2009. This level ofpredictable outperformance bodes well forthe stock as analysts continuouslyunderestimate the earnings power ofStarwood.*Starwood is a play on the internationalluxury market* Starwood has been very successful atmaintaining a long term focus on their fourdrivers of growth and asian expansionwhich enhances shareholder value*The barriers to entry in this market arevery high. Not only is the industry verycapital intensive, but it also takes a longtime to build a brand name that ressonateswith customers.CatalystsTime*Assuming multiples stay steady, as there isno reason to assume they wouldn't,Starwood will find fair value as it continuesto outperform analyst expectations on EPS*Continued realization of real-estate valuewill drive large cash sums and result inincreased dividends and share buybackswhich will draw more investor attention.The dividend doubled in 2012*Continued growth/stability in the Asianmarkets will drive deal volume. Anybullishness in the world economy willdrive high beta companies with luxuryexposure higher.All in all, continued financial outperformance, fueled by international growth, a strong globalpositioning, brand loyalty, and the strategic move to an asset-light model will drive Starwood stockhigher over the next year.
Starwood Hotels & Resorts Worldwide (HOT)Mkt Cap: 12.2B*Price (Feb 13): 62.03*Price Target: 80.33 in 1 yearSWOT AnalysisStrengthsWeaknesses1) Multiple brands with strong customerrecognition1)Highly competitive and mature industry5) Strong International pipeline2)Owns less hard assets to securitize ifneeded3) Seasonal industry4) Luxury brands exclude many potentialcustomers5) Large domestic market focusOpportunitiesThreats2) Focused long term management team3) Good Corporate Relationships4) Starwood Preferred Guest Program1) Large growth in foreign markets by whichStarwood is best positioned for2) Continued expansion of rewardsprograms to keep active corporatecontracts3) First mover advantage in many markets4) Pricing power1) Highly competitive and matureindustry2) Luxury brands exclude many potentialcustomers3) Owns less hard assets to securitize ifneeded4) Large domestic market focus5) currency fluctuations and othergeopolitical risks5) Enhance shareholder value throughcontinued asset light modelStarwood's threates and weaknesses are primarily a function of the industry by which it operatesand less an operational deficiency within the company. For example, Starwood faces currencyrisk, poltiical risk, government regulation (or power) chanages, all of which are out of the controlof the company. These risk re mitigated by opportunity factors such as further innovation of theirancillary revenues portfolios and expansion into new markets. Furthermore, they have a uniqueproduct, customer loyalty, and a brand name that resonates throughout the world. All in all ibelieve the strengths outweigh the weaknesses and the opportunities are worth the threats.
Starwood Hotels & Resorts Worldwide (HOT)Mkt Cap: 12.2B*Price (Feb 13): 62.03*Price Target: 80.33 in 1 yearPorter's Five ForcesThreat of New Entrants: LowSome of the primary competitors areHilton, Hyatt, and Marriott. Thecompetition in this industry is strong butthe arriers to e try are great. It’s aremarkably capital intensive industry. Inaddition, the high end luxury industryrequires brand name familiarity to helpvalidate spending on large room rents.There is considerable brand loyalty withinthe luxury hotel space. Thus, it would take avery long time (decades), development ofdeveloper and industry connections, andlarge capital investments to be a crediblethreat to Starwood.Bargaining Power of Customers:LowBecause there are few global players inthe luxury hotel space, the consumermust either pick a regional option orchoose from three companies. Thismakes price comparability difficult.Starwood is unique in design and styleand as such can offer a unique price.Furthermore, the consumer is choosingto spend more on stay then they have toas there are cheaper options available tothem, and as such, they are more flexiblein price. Starwood attracts the priceflexible that demand service overdiscounted value.*High Barriers to entry*High Capital Requirements*low price sensitivity*Industry requires economies of scale*lack of comparable pricing options*strong brand name recognition andcustomer loyalty*customers demand quality over priceThreats of Substitutes - NoneThe substitutes to hotels include hostels, camp sites, staying with friends and family, or renting alocal house or condo. None of these are real substitutes for the type of customer that Starwoodattracts. There are effectively no substitute products for the luxury hotel industry and as such,there will always be demand for luxury hotels where the primary factors that drive consumptionchanges are supply of hotels, not alternatives to hotels*There are no realistic substitutes for luxury hotels*substantial product differentiation from next alternative
Starwood Hotels & Resorts Worldwide (HOT)Mkt Cap: 12.2B*Price (Feb 13): 62.03*Price Target: 80.33 in 1 yearPorter's Five ForcesBargaining Power of Suppliers: MediumWhile there are many suppliers that serve the hotel industry, luxury being no exception, suppliersdo have bargaining power in this industry for a few reasons. Firstly, long term contracts tend toexist between suppliers and hotel operators. Secondly, there must be uniformity within a hotel.Four Seasons has beds made specifically for their hotels by one supplier so switching costs wouldbe very high as they would have to change all beds. There are also multiple suppliers for manythings ranging from furniture to food. Inversely, these suppliers are highly dependent on hotels,often a few hotels, and as such cannot afford to lose those contracts. While it would be costly forStarwood to seek alternatives to, say, a supplier of curtains, the cost to Starwood would be farless than the cost of the supplier for loosing said contract. Its fair to assume there is an equal andequitable balance between suppliers and the hotel operators, and bargaining power is equallyshared.* Many substitute suppliers*Uniformity across products is vital to consistency*Switching costs may be high depending on the productIntensity of Existing Rivalry: High in the US and Europe, Med in China &Japan, Med-Low in Asia ex China and Japan, Low in UAE & AfricaThe luxury hotel industry is concentrated. This creates strong competition amongst rivals. Thereare very few global competitors and only a handful of domestic competitors that haveestablishments in all the key geographies. The competition in the high end luxury hotel industry(intra industry) is largely based on preference and experience. Furthermore, there are largemembership programs to all the major hotels that create strong customer loyalty. It is less likelythat, given equivalent options, Starwood will steal customers from Hyatt or Hyatt from Starwoodif the consumer's preferences are well established. The competition is high in established marketswith established customer preferences like the US and Europe. The competition in China andJapan is medium (although Starwood has significant advantage in China). The competition in therest of Asia is much lower as Starwood has a first mover advantage in many of those countries.The competition is low in Africa and the UAE as many companies have been hesitant to expanddevelopment since the crisis; this is a strong growth driver in the future.*Large industry with few competitors, especially on the global scale*First mover advantage helped create loyalty in emerging markets*Degree of competitive rivalry is a geographic consideration
Starwood Hotels & Resorts Worldwide (HOT)Mkt Cap: 12.2B*Price (Feb 13): 62.03*Price Target: 80.33 in 1 yearThe CompanyStarwood is a global luxury hotel operator and one of the largest in the world. Starwood hasinterests in the lodging segment and generates revenue by either their owned hotels or themanagement of and franchise rights with respect to their properties. Starwood also makes moneyfrom marketing and selling vacation ownership interests (VOIs). Starwood strategically allocatestheir resources to the growing markets around the world with a focus on Asia as well as theMiddle East. For the last decade, Starwood has been moving toward an asset light businessmodel.Owned/ SVO / JVs /Other16%Year: 200084%year: 2011Managed and Franchised40%Target20%80%60%Starwood's Portfolio of BrandsStarwood has 9 brands and over 1100hotels which is the largest luxury portfolioin the world. St. Regis has a target of 50hotels. Over ½ the rooms are outside of theUS as opposed to other brands where onlyabout 1/3 of their rooms are outside theUS.28 hotels in 13countries79 hotels in29countries99 hotels in41countries42 hotels in 17 countries56 hotels in 10countries161 hotels in 28 countries10 hotels in the US188 hotelsin 36countries418 hotelsin 70countries
Starwood Hotels & Resorts Worldwide (HOT)Mkt Cap: 12.2B*Price (Feb 13): 62.03*Price Target: 80.33 in 1 yearSt. Regis & The Luxury CollectionThe St. Regis and The Luxury Collection are both luxury full-servicehotels and resorts representing the highest end of Starwood'sportfolio. The St. Regis started off as one hotel in New York Cityand grew to 30 hotels worldwide with 6,413 rooms. The St. Registargets high-end-leisure and business travelers. Most St. Regishave individual design characteristics to capture the personality oft he locations they are in. The Luxury Collection span fromlegendary places to remote retreats. They are marked byimpeccable service and decor. Like the St. RegisLuxury Collection, Ethiopiathey appeal to only the price indiscriminanttraveler. The Luxury Collectionencompasses 85 resorts worldwide with16,366 rooms.Monarch BeachSt. Regis BeijingHotels Owned by StarwoodNorth AmericaThe Phoenician, ScottsdaleScottsdale, AZ1643The St. Regis San FranciscoSan Francisco, CA1260New York, NY1229Bal Harbour, FL124341,375Florence, ItalyVenice, ItalySeville, Spain11110090151San SebastianSalzburg, Austria1113669Hotel Imperial, ViennaVienna, Austria1138Park Tower, Buenos AiresSt. Regis Osaka**Buenos AiresOsaka, Japan11181160Rome, Italy116191,186132,561The St. Regis New YorkThe St. Regis Bal Harbour ResortNorth AmericaInternationalSt. Regis FlorenceThe Gritti Palace, VeniceHotel Alfonso XIII, SevilleHotel Maria Cristina, San SebastianHotel Goldener Hirsch, SalzburgSt. Regis Grand Hotel, RomeInternationalSt. Regis / Luxury Collection
Starwood Hotels & Resorts Worldwide (HOT)Mkt Cap: 12.2B*Price (Feb 13): 62.03*Price Target: 80.33 in 1 yearThe W & The SheratonThe W is a luxury upscale hotel that emphasizes iconicdesigns for an extraordinary experience. Each hotel isuniquely designed and inspired by its location. It ismost known for its vibrant lounges and cocktail bars.There are 44 Ws worldwide with 12,369 rooms. TheSheraton is also a luxury hotel and one of the mostpopular in Asia Pacific area. It has catered to upscalebusiness and vacationers for over 75 years. There are427 Sheratons worldwide with 149,784 rooms. 97 ofthose hotels are in Asia and 30 of them are in Africaand the Middle East.Sheraton, EgyptHotels Owned by StarwoodNorth AmericaW New Orleans - French QuarterScottsdale, AZW New OrleansSan Francisco, CAW New York - Times SquareNew York, NYLe Centre Sheraton Montreal HotelMontreal, CanadaSheraton Gateway Hotel in Toronto International AirToronto, CanadaSheraton Centre Toronto HotelToronto, CanadaSheraton Kauai ResortKoloa, HISheraton Steamboat ResortSteamboat Springs, COSheraton Suites Philadelphia AirportPhiladelphia, PARooms6432602298254741,377394208251North AmericaInternationalSheraton Diana Majestic, MilanMilan, ItalyMilan, ItalyThe Park Lane Hotel, LondonLondon, EnglandSheraton Santa Maria de El PaularRascafria, SpainSheraton Paris Airport Hotel & Conference Centre**Roissy Aerogare, FranceSheraton Maria Isabel Hotel & TowersMexico City, Mexico2,39210630344252755Sheraton Ambassador Hotel229Monterrey, MexicoSheraton Buenos Aires Hotel & Convention Center Buenos Aires, Argentina742Sheraton Rio Hotel & ResortRio de Janeiro, Brazil542Sheraton Lima Hotel & Convention CenterSheraton on the ParkLima, PeruSydney, Australia431557W BarcelonaBarcelona , Spain473W London - Leicester SquareLondon, UK192Sheraton Fiji ResortInternationalNadi, Fiji2644,890The W & The Sheraton Worldwide229,436
Starwood Hotels & Resorts Worldwide (HOT)Mkt Cap: 12.2B*Price (Feb 13): 62.03*Price Target: 80.33 in 1 yearThe Remaining BrandsLe Meridien was started in Paris and has over 100 properties in 43 countries. It is an artisticallydriven hotel that operates at the luxury and upscale full service level. Le Meridien seeks to bringart to the forefront of the guest's visit. The Westin is another Luxury hotel and resort that fits themost standard mold of what you would expect from a high end hotel. There are 192 hotelsworldwide with 74,626 rooms. Four Points is a select service hotel designed for travelers and hastheir own local craft beer. There are 171 hotels worldwide with 30,924 rooms. Aloft is also aselect service hotel that boasts unique designs for affordable prices. There are 62 hotelsworldwide with 9859 rooms. Element is a new hotel brand that is up scale and offersextended stay. It is unique in that it has a modern emphasis onnature and environmentally conscious living. There are 10 hotels inthe US with 1641 rooms. There are additionally 17 other hotels inthe portfolio accounting for 8,086 roomsLe Meridian,IsraelHotels Owned by StarwoodNorth AmericaThe Westin St. John Resort & VillasThe Westin Peachtree Plaza, AtlantaThe Westin San Francisco AirportThe Westin Maui Resort & Spa, Ka'anapaliAloft LexingtonAloft Philadelphia AirportAloft San Francisco AirportFour Points by Sheraton Tucson UniversityFour Points by Sheraton Philadelphia AirportThe Tremont Chicago Hotel at Magnificent MileElement LexingtonNorth AmericaInternationalThe Westin Excelsior, FlorenceThe Westin Excelsior, RomeThe Westin Dublin**The Westin Denarau Island Resort & Spa, FijiThe Westin Resort & Spa, CancunThe Westin Resort & Spa, Los Florence, ItalyRome, ItalyDublin, IrelandNadi, FijiCancun, MexicoLos Cabos, Mexico171316163273379243The Westin Resort & Spa, Puerto VallartaPuerto Vallarta, Mexico280St. John, Virgin IslandsAtlanta, GASan Francisco, CALahaina, HILexington, MAPhiladelphia, PAMillbrae, CATucson, AZPhiladelphia, PAChicago, ILLexington, MAInternational1,825Other Starwood Brands185,333
Starwood Hotels & Resorts Worldwide (HOT)Mkt Cap: 12.2B*Price (Feb 13): 62.03*Price Target: 80.33 in 1 yearPeopleThe people working at Starwood are one of the most important factors in the success of thecompany. Starwood's employees are what they refer to as 'locally smart'. This means theemployees are from the areas that they are serving. They understand the culture, they speak thelanguage, and they can relate to the clientele. Too often companies try to copy and paste theirmodel on other countries, we just saw this with Home Depot in 2012, and it doesn't work becauseyou have to truly embrace the culture you are infiltrating. As such, the people at Starwood comefrom their markets and really know their markets.Frits Van Paasschen - President nd CEOhas been CEO and President since 2007Prior he was the president of the largest division at Coors Brewing Co.Previous to that Mr. Van Paasschen worked in private equity covering Middle East andAfricaVasant M Prabhu - Vice Chairman and CFOHas been with Starwood since 2003Previously was CEO of Safeway.Prior to that he held senior roles at McGraw HillStephen Ho - President, Asia PacificMr. Ho manages the most expansive pipeline for StarwoodBegan career at Starwood in 1981Grew Starwood's footprint from 12 hotels in China to 200 hotels spanning Hong Kong,Macau, Taiwan, and KoreaQian Jin - President, Greater ChinaQian Jin, PhD has been with Starwood in 1986Qian has served various roles and expanded china to over 100 hotelsRoeland Vos - President: Europe, Africa, and Middle EastStarted at Starwood in 1982Covers 260 hotels in 58 countriesMiguel Ko - Non-Executive ChairmanFormer President of Asia Pacific and the true driver of the Asian growth story forStarwood breeding the company for Asian expansionStarted with the Company in 1979 and is one of Starwood's greatest assets as he hasunparalleled global experience.Between Roeland, Quin, Miguel, and Stephan there is over 110 years of experience between thefour at Starwood Hotels alone. Management has not suffered massive turnover which helps drivestrategy and creates the most experienced locally smart teams. These individuals know Starwoodbetter than anyone else and can focus on enhancing Starwood value not just tomorrow or theyear after but for decades to come.
Starwood Hotels & Resorts Worldwide (HOT)Mkt Cap: 12.2B*Price (Feb 13): 62.03*Price Target: 80.33 in 1 yearStarwood Prefered Guest Program (SPG)SPG is a value driving membership program which attempts to entice further utilization ofStarwood assets by awarding points. The points are redeemable across all nine brands and earnedfor every dollar spent. This reward program differs from many others in a few ways; First, SPG isthe only lodging reward program without any blackout dates. Secondly one can get award flightson over 350 airliners around the world, larger than any other hotel rewards program. SPGmembers can get special access to certain entertainment events, VIP tournaments, and backstagetours.SPG is targeted to various markets selectively. SPG powers 50% of the room night staysworldwide and the redemptions are unique to the location as opposed to an ill fitting canvas.Internationally, There has been 32% membership growth since 2007 and 44% of total membersare from outside the US. The Chinese membership base has increased by 60%The exciting new feature in the SPG is their new deal with Delta. This innovative agreementallows reward sharing between Delta and Starwood. The SPG platinum member will receivemedallion benefits at the airport and on Delta flights and Delta members will receive Starwoodpoints. This targets frequent travelers which enhances both Delta and Starwood's loyaltyprograms. Delta has one of the largest loyalty programs and is one of th e largest airlines in theUS. By putting high end airlines together with high end lodging, further loyalty and revenues arelikely to be observed.Last year SPG membership grew from 14-16% depending on the degree of involvement.Retention of elite members was up 6% and with the new opportunity to recruit loyalist fromDelta's frequent flyers program, this should increase. In the luxury and upscale lodging business,customer loyalty (and business loyalty) are the bread and butter of long term success.Sheraton, SpainSt. Regis, BaliFour Points, Malaysia
Starwood Hotels & Resorts Worldwide (HOT)Mkt Cap: 12.2B*Price (Feb 13): 62.03*Price Target: 80.33 in 1 yearGrowth in ChinaAccording to McKinsey and Co. Chinese GDP willa ou t for % of the orld’s e o o i output y2020. This is over 2 times that of 2010. China willalso see migration to urban areas from rural farminglands. In 2010 there were 650 million living in urbanareas and by 2020 there should be an increase to850 million. China has been taking aggressivemeasures to spur private consumption and savingswhich in turn bodes well for the lodging business.Starwood will capitalize on this growth by servicingboth outgoing and inbound travelers. By 2020 GDPgrowth in Shandong will most likely match that ofBelgium. Thanks to a rapidly expanding ChineseStarwood Projects Growth middle class, as well as an affluent class that willtripsUSChina triple between 2010 and 2020, there is significantcurrent and future demand for luxury items.Outbound (2011) 58 milDiscretionary spending will be the largest growing70 milcategory of the consumers budget with growth ofDomestic (2011) 2 Bil2.6 Bil 13.4% per annum between 2010 and 2020. OneOutbound (2015) 64 mil100mil reason for this is the Chinese individual observes thegrowth of their country and "aspirationally tradesDue to the dichotomy between GDP growthup". China could overtake Japan to become theand employment growth, Chinas 12th fivelargest luxury market by 2015. - (this information isyear plan focuses heavily on enhancingfrom McKinsey)services led employment. With anexpanding tourism and businessenvironment, the lodging businesses shouldbe in a prime place to take advantage ofgovernment initiatives. In a country likeChina, you want to be on the governmentsagenda in regards to economic growth. Thiswill reduce the amount of red tape inherentwithin the Party politics.In addition, there is significant fear driven precautionary savings occurring in China. Thegovernment is addressing directly this issue by exciting private consumption which is predicted tomost reveal itself in the service and consumption sectors s labor gains larger power to enhancetheir w ages and the Chinese economy becomes "more free".
Starwood Hotels & Resorts Worldwide (HOT)Mkt Cap: 12.2B*Price (Feb 13): 62.03*Price Target: 80.33 in 1 yearGrowth in Asia PacificAs you can see in the graph to the rightcourtesy of the IMF, there is significantcredit expansion and growth to the privatesector. The Asian sector should continue tobe the growth leader of the globe andeasily outpace world average GDP by 2percentage points. Sustained rates ofgrowth in the immediate, medium and longterm are not just drivers of the country, butin fact a comment on the rising importanceof Asia Pacific in the world economy.Countries such as Korea are consuming(possibly irresponsibly) luxury goods in everincreasing rates as wealth has introducedsocial status awareness and newopportunities to consume goods (such asluxury hotels) that were previouslyreserved for the ultra-wealthy.Travelers by Origin CountryTravelers by Origin CountryThailandThailandAsia Pacific GDPGDP Per CountryGDP Per Country
Starwood Hotels & Resorts Worldwide (HOT)Mkt Cap: 12.2B*Price (Feb 13): 62.03*Price Target: 80.33 in 1 yearGrowth in AfricaThe demand and continental exclusivity for luxury waschanged when South Africa joined the emergingmarkets. Its often misunderstood that the emergingmarkets contain Latin America and the Asiancommunities. Africa has huge potential! The naturalresources that the continent possesses is a catalyst forgrowth.The misconception is that Africa is a bunch of people running around in a desert. There are realeconomies with real growth potential that will present themselves in due course. As gold pricescontinue to drive higher and the financial systems advance the South African communities arebecoming more and more affluent. The wealthy in Africa have disproportionately high purchasingpower compared to the rest of their populations, this presents opportunity for companies whichcan and are willing to make early stage investments within the evolving African communities,such as Starwood is doing. Data on the African consumer is hard to come by and as suchStarwood has been very tentative to the cultural needs of the consumer such as larger amountsof cash based transactions and adaptation of local networks.Growth in the Middle EastA CAGR of 9.9% should be expected in the Middle East high end travel retail sales between 2010and 2015 according to Alpen Capital. Traffic in Qatar and the major cities in the UAE are driving amassive amount of travel and sales. The Middle East constitutes a middle market between Asia,the Americas, Europe and the Middle East. The booming tourism are key drivers of luxury andretail sales, tourism that not only drives hotel rates but also ancillary revenues at the hotels. Asthe Arab Spring subsides and stability in the Middle east becomes closer to a reality, positive.Size of Retail Trade (bln)Stronger growth in Bahrain and Saudi Arabia havereally propelled the middle east as growth from 2010and 2011 was 14.2% and 12.1% respectively. Thanks toaffluent consumers in the Middle East hotels enjoyupward 90% occupancy. In Abu Dhabi and Dubai thepredicted growth in the hospitality market is threetimes higher than the growth rate of the overalleconomy.1008060402002006 2007 2008 2009 2010
Starwood Hotels & Resorts Worldwide (HOT)Mkt Cap: 12.2B*Price (Feb 13): 62.03*Price Target: 80.33 in 1 yearHow Starwood is Addressing China203 Hotels (72,000 rooms): 103 Operating and 100 in the pipelineIn addition to the first mover advantage, Starwood deeply engages the social and cultural identityof China. They offer distinct local programs and serve the Chinese people what the Chinesepeople traditionally eat, not just American food. There are more restaurants per hotel in Chinathen any of the other Starwood hotels around the world because the Chinese prefer options. Inthe Chinese hotels there are tea kettles, slippers, and a menu that includes congee, noodles, andrice centric dishes. The Asian community is only beginning to adopt brand loyalty, unlike in the USwhere it has been a phenomena for some time. Thus Starwood is well positioned to win the favorof the people and expand their own brand over the country and Asian continent. Over 60% ofguests in Starwood hotels within China are domestic travelers, further emphasizing the growingneed not just to meet the demand of international travel, for leisure and business, to China, butalso to accommodate the rapidly expanding Chinese middle class.Starwood first ventured into China in 1974 whenthey opened the Sheraton Hong Kong and in 1985they became the first international chain to openbranded hotel in mainland China; The great WallSheraton Hotel in Beijing. Between 1985 and 2005Starwood opened 25 hotels. Between 2005 and2012, they had over 100 open hotels and 100 morein the pipeline.The JistWith 57 million international arrivals, 70 million outbound trips, and an expected 43% increase to100 million outbound trips by 2015, this is a market that many other lodging companies aremissing out on. The 2.6 billion domestic trips outpace any other country. Continued heavyexpansion into China will be key in driving value for Starwood and with 171 cities with over onemillion people (4x that of the US) there is a strong need for supplyHotels in the PipelineHotels in Operation
Starwood Hotels & Resorts Worldwide (HOT)Mkt Cap: 12.2B*Price (Feb 13): 62.03*Price Target: 80.33 in 1 yearHow Starwood is Addressing Asia PacificFor countries with this sort of expectedgrowth, there must be accommodatinggovernments, solid infrastructure, and ofcourse lodging to satisfy the needs ofbusiness. Over 70% of the worlds GDPgrowth over the next decade is expected tocome from Asia. India, for example, shouldgo from them 11th to the 5th largestconsumer market by 2025.IndiaIndonesiaThailandThe USGDP (bn)20112016E% ion20112016E% India120712897%Indonesia2412597%Thailand64663%The US3123275%Starwood is Expanding Their Asian Portfolio Rapidly175 Hotels: 122 Operating and 53 Pipeline (executed)South Asia: 63 Hotels - 36 Operating, 27 in the PipelineJapan/Korea/Guam: 24 Hotels - 23 Operating, 1 in the PipelineStarwood believes their firstIndo China: 32 Hotels - 23 Operating, 9 in the Pipelinemover advantage gives themSouth East Asia: 39 Hotels - 24 Operating, 14 in the PipelineAustralia/Pacific region: 18 hotels - 16 Operating, 2 in the Pipeline a strong position in the regionas they have strong ties withboth developers, and bigbusiness. In the pipeline,roughly 40% are Sheratons.Asia Pacific (including China),makes up 65% of the pipelineStarwood is opening more new rooms than any other US hotel operator2011
Starwood Hotels & Resorts Worldwide (HOT)Mkt Cap: 12.2B*Price (Feb 13): 62.03*Price Target: 80.33 in 1 year4 Key Levers to Driving ValueManagement has identified four key levers to driving the value of Starwood. These are controllingSG&A, expanding hotel footprint, growing RevPar, and effectively managing their wholly ownedreal estate. As these are the o pa y’s goals, it is prude t to disse t the a d est u dersta dthe story, the strategy, and the execution of these value drivers1) Controlling SG&A% Revenue and SG&A growth 2009-2012This is an important part of hotel management as it isvery easy to loose control over SG&A costs.Management announced that their run rate for SG&Ais 3% although it was 5% in the last quarter due tosome incentives payouts and other one time costs.Viewing the geometric average of SG&A growth from2009 to 2013E you get 4.179%. When comparing thatto the growth rate in total revenues of 9.36% over thesame time period, one can see the impressivemanagement of SG&A1.61.41.2120092010Revenue growth20112012SG&A growthStarwood is controlling SG&A as planned2) Expanding Hotel volume and country presenceHotel BrandHotelsSt. Regis14Sheraton409Four P
Starwood Hotels & Resorts Worldwide (HOT) is a global hotel and leisure company. Starwood has . Hotel Imperial, Vienna 1 138 Park Tower, Buenos Aires 1 181 St. Regis Osaka** 1 160 St. Regis Grand Hotel, Rome 1 161 International 9 St. Regis / Luxury Collection 13 The St. Regis and The Luxury Collection are both luxury full-service .
Each mirror plan has the same design as the Starwood Hotels & Resorts Worldwide, Inc. Savings and Retirement Plan as adopted by Starwood Hotels & Resorts Worldwide, Inc. except that the Starwood Company Stock Fund is not an available investment. This booklet serves as the summary plan description ("SPD") for these mirror plans.
United Kingdom, Japan and Iceland. The group currently owns a total of 41 hotels and resorts with 6,111 rooms under the Berjaya Hotels & Resorts brand, ANSA Hotels & Resorts brand, joint-ventures with other luxury hospitality brands, and acquisition of Icelandair Hotels. The group al
Starwood mull new buyer. THE . board of Starwood Hotels & Resorts Worldwide are assessing a non-binding proposal from a consortium of companies, led by Anbang Insurance Group, to buy all outstanding shares of common stock for 76.00 per share in cash. The bid comes four months after Starwood entered a definitive . pact with Marriott International
AWARDS OF DISTINCTION Top Resorts In Texas & The Midwest: Readers’ Choice Awards Condé Nast Traveler 2018 Best Hotels, USA U.S News & World Report 2018, 2017, 2015, 2012 Best Hotels, Texas U.S News & World Report 2016 Top 30 Resorts In Texas & America The Southwest Condé Nast Traveler 2016 Top 25 Resorts In Texas & The Southwest Condé Nast .
Starwood Hotels and Resorts cover 30 very famous and luxury hotel brands sucha s The Ritz-Carlton, Sheraton, Bvlgari Hotels &Resorts etc. There is Sheraton Bratislava Hotel in major city of Slovakia. Vienna House is Austria’s largest independent hotel group: 34 hotels
4 4 Wyndham Worldwide is in the process of spinning off its Hotel Group business, which will be named Wyndham Hotels & Resorts, Inc. The spin-off is expected to occur in the second quarter of 2018 This document provides summary pro forma information Wyndham Hotels & Resorts, including:
Marriott Hotels (JW Marriott) 1 402 1 402 Starwood Hotels & Resorts (Sheraton) - - 1 270 Best Western2 7 731 6 349 Total American 11 1,801 24 3,484 European hotel groups and voluntary hotel chains/consortia InterContinental Hotels Group (InterContinental & Crowne Plaza) 2 351 2 421 Accor (Sofitel, Pullman, Novotel, Mercure & Ibis)
Assessment commentary and marks Commentary on BEC Higher: Cyrielle and Christopher UCLES 2012. This material may be photocopied (without alteration) and .
