Hotel Stock Hindered by Gloomy Forecast

The company also reported mixed first-quarter results

Deputy Editor
May 3, 2022 at 10:30 AM
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Hilton Worldwide Holdings Inc (NYSE:HLT), formerly known as Hilton Hotels Corporation, is down 5.9% to trade at $146.27 this morning, after the company's dismal 2022 profit forecast. The hotel giant reported mixed first-quarter results, with earnings of 71 cents per share beating analyst estimates by six cents, while the reported revenue of $1.72 billion came in just below the anticipated $1.73 billion. The recent surge in travel gave profits a boost, but Hilton still expects RevPAR (revenue per available room) to come up short of 2019 levels. 

HLT recently hit an April 22 record high of $167.99. Today's drop is pushing the shares further from their year-to-date breakeven level, although HLT's 160-day moving average has so far contained the damage. 

Put traders are targeting HLT with fervor this morning. So far, 2,533 puts have crossed the tape, which is seven times the intraday average, compared to 1,294 calls. The May 145 and 150 puts are the most popular, with new positions being bought to open at the May 100 put. 

It's also worth noting that the security ranks low on the Schaeffer's Volatility Scorecard (SVS), with a score of just 11 out of 100. In other words, Hilton stock has consistently realized lower volatility than its options have priced in, making the stock a potential premium-selling candidate.


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