Here's Why You Should Retain Marriott Stock in Your Portfolio Now

Marriott International, Inc. MAR is likely to benefit from solid leisure demand, a rise in group bookings and unit-expansion efforts. The focus on the loyalty program bodes well. However, soft demand in China is a concern.MAR’s Growth CatalystsMarriott’s shares have soared 26.6% in the past three months compared with the industry’s 18.9% rise. The company has been benefitting from a solid increase in global travel demand and a rise in group bookings.During the third quarter, group RevPAR rose 10% year over year, supported by increases in both room nights and ADR. Business transient demand increased and leisure transient revenue per available room (RevPAR) remained above pre-pandemic levels. The company stated that group revenues for 2025 were pacing 7% higher (by the end of the third quarter), driven by a 3% increase in room nights and a 4% rise in ADR.Image Source: Zacks Investment ResearchThe company continues to enhance its Bonvoy loyalty program, which now has more than 219 million members (as of the third-quarter 2024). Engagement initiatives, including co-branded credit cards and collaborations like the Taylor Swift Eras Tour sweepstakes, have bolstered member interaction. A recent partnership with Starbucks has further elevated the program, enabling even members with a single hotel stay to redeem points for a coffee.Marriott is consistently trying to expand its presence worldwide and capitalize on the demand for hotels in international markets. During the third-quarter 2024, Marriott's development pipeline reached a record 585,000 rooms, reflecting a 5% sequential growth. The company added 16,000 net rooms in the third quarter, bringing its global total to over 1.67 million rooms.Conversion activity was strong, representing over 30% of new room additions and more than 50% of signings in the third quarter. A notable deal with Sonder added 9,000 existing rooms to Marriott’s portfolio, focusing on long-stay accommodations in markets like New York and Dubai. The company expects positive development trends to continue on the back of new development and multiunit conversion opportunities.China Woes Ail MarriottSofter domestic demand in China remains a concern for the company. During the third-quarter 2024, the company reported dismal performance in China. RevPAR in Greater China declined by approximately 8% due to weak domestic leisure demand, macroeconomic pressures and weather-related disruptions. Going forward, the company is cautious due to continued softness in demand and pricing trends in China for the remainder of 2024.Our Thoughts on MAR StockMarriott's strong global travel demand, thriving group bookings and aggressive unit expansion efforts highlight its potential for sustained growth. Enhancements to the Bonvoy loyalty program and strategic partnerships further bolster its competitive edge. However, persistent softness in China and premium valuation levels warrant caution.With a forward P/E ratio of 27.43 compared to the industry average of 25.61x, Marriott's stock trades at a premium, which could limit significant upside potential in the near term. While these risks warrant attention, the company’s solid fundamentals and strategic growth initiatives provide enough reasons for investors to retain the stock. The Zacks Rank #3 (Hold) justifies our thesis.Key PicksSome better-ranked stocks in the Zacks Consumer Discretionary sector are:Carnival Corporation & plc CCL currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks Rank #1 stocks here.CCL has a trailing four-quarter earnings surprise of 318.1%, on average. The stock has surged 72.5% in the past year. The Zacks Consensus Estimate for CCL’s fiscal 2024 sales indicates growth of 16.6% from year-ago levels.Norwegian Cruise Line Holdings Ltd. NCLH currently sports a Zacks Rank #1. NCLH has a trailing four-quarter earnings surprise of 4.2%, on average. The stock has surged 88.7% in the past year.The Zacks Consensus Estimate for NCLH’s 2024 sales and EPS indicates growth of 10.2% and 134.3%, respectively, from year-ago levels.Royal Caribbean Cruises Ltd. RCL currently carries a Zacks Rank #2 (Buy). RCL has a trailing four-quarter earnings surprise of 16.2%, on average. The stock has surged 125.8% in the past year.The Zacks Consensus Estimate for RCL’s 2024 sales and EPS indicates growth of 18.6% and 71.6%, respectively, from year-ago levels.5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Carnival Corporation (CCL): Free Stock Analysis Report Marriott International, Inc. (MAR): Free Stock Analysis Report Royal Caribbean Cruises Ltd. (RCL): Free Stock Analysis Report Norwegian Cruise Line Holdings Ltd. 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