Hyatt Hotels Insider Sells Over $249 Million in Stock

An insider with the Margot & Tom Pritzker Foundation has recently divested a substantial portion of Hyatt Hotels Corp stock. According to a report submitted to the Securities and Exchange Commission, the foundation, which is part of the 10% owner category, sold 1,642,251 shares of Class A common stock at a price of $152.23 per share, amounting to over $249 million.

The sale occurred on September 22, 2024, as part of multiple transactions involving both derivative and non-derivative securities. Notably, the shares sold were automatically converted from Class B common stock to Class A common stock, a conversion exempt from liability under Rule 16b-6(b) and aligned with the company’s amended certificate of incorporation.

The foundation is linked to the Maroon Private Trust Company, LLC, which acts as the trustee and holds investment authority over the shares owned by the foundation. Beneficiaries of the foundation do not possess investment power over the Class B common stock held. The foundation indicated that it may be seen as part of a group due to various voting agreements and share transfer restrictions, though it disclaims beneficial ownership of the reported securities except to the extent of its financial interest.

Following this transaction, the foundation’s holdings in Hyatt Hotels Corp are now at zero shares of Class A common stock, marking a significant shift in its investment strategy. The filing was signed by Derek Arend, the President of the Trustee, on September 24, 2024.

In related news, Hyatt Hotels Corporation has made significant advancements in its financial and strategic position. The company has repurchased $250 million in Class B shares as part of its ongoing capital management efforts, leaving approximately $982 million remaining under its current repurchase authorization.

Additionally, Hyatt has chosen to implement the Oracle OPERA Cloud platform across its global hotel portfolio to standardize operations and enhance data management, reflecting the company’s commitment to technological advancement for improved operational efficiency and guest services.

In the realm of analyst coverage, Goldman Sachs has initiated a Neutral rating on Hyatt with a price target of $151. Other firms such as Jefferies, Stifel, and JPMorgan have adjusted their price targets upward to $152, $151, and $164, respectively. Citi has reaffirmed its Neutral stance while maintaining a $165 price target.

For earnings, Citi estimates that Hyatt’s third-quarter 2024 earnings per share (EPS) will be $0.95, and has raised the full-year 2024 EPS estimate to $4.37. However, the EPS estimate for fiscal year 2025 has been adjusted down to $4.04, highlighting recent developments in Hyatt’s strategic and financial landscape.

In summary, amidst the Margot & Tom Pritzker Foundation’s sale of a substantial stake in Hyatt Hotels Corp, the company has shown solid financial metrics, including a gross profit margin of 68.06% over the past year as of Q2 2024, and a stock price increase of 47.93% over the same period. With the stock trading at a Price/Book ratio of 4.06, it may be valued at a premium compared to its asset book value.

Hyatt’s market capitalization is currently at $15.61 billion, with shares traded close to their 52-week high. The previous close was at $151.59, and the company operates with a moderate level of debt, an important aspect for evaluating its financial health. For further insights and analysis, investors may explore additional resources available for Hyatt Hotels Corp.