If you’ve been following this blog over the past year, you know there are a number of Chinese companies I think are excellent investments today. Now, these companies run the gamut from social media to education, and yesterday after the closing bell, another one of my favorites released earnings. Today, we’ll take a look at what that earnings report could mean for you…
China Lodging Group, Limited (HTHT) manages and develops hotel franchises in China. This highly aggressive stock was founded in 2007 and is based in Shanghai. The company operates several brands of hotels, including Manxin Hotels and Resorts, JI Hotel, Joya Hotel, Starway Hotel and Hi Inn.
Following the closing bell on Tuesday, China Lodging Group, Limited released results for its fourth quarter in fiscal year 2017. The Chinese hotel management company reported that it opened 137 hotels during the quarter, and fourth-quarter revenue jumped 32.6% year-over-year to RMB 2,214.9 million, or $340.4 million. Now, although those were solid numbers, analysts were looking for $344.48 million. So HTHT posted a 1.2% sales miss.
However, net income still soared 82% year-over-year to RMB 229.4 million, or $35.3 million. But adjusted earnings per ADS only came in at $0.52, which missed analysts’ estimates for $0.73. So HTHT also posted a 28.8% earnings miss.
For fiscal year 2017, China Lodging Group reported that it had 3,746 hotels in operation. Also, the company reported adjusted earnings per ADS of $2.60 on RMB 8,170.2 million, or $1.26 billion in sales. That represents 45.3% annual earnings growth and 22.3% annual sales growth.
For the first quarter, China Lodging Group expects revenues to grow between 27% and 29%, which is slightly higher than the consensus estimate for 25.4% annual sales growth. And for full-year 2018, the company expects revenue to increase between 16% and 19%. HTHT is also looking to open between 650 and 700 hotels this year.
Given the fourth-quarter earnings and sales miss, HTHT shares pulled back more than 9% in pre-market trading this morning. However, China Lodging Group’s outlook for both the first quarter and full year is healthy. And the company boasts a strong track record of hotel openings. So I expect shares to bounce back soon.
That makes right now an excellent buying opportunity for China Lodging Group, but before you rush out to purchase shares of HTHT, I urge you to join my Blue Chip Growth service. As I said, China Lodging Group is an extremely aggressive stock, and only my Blue Chip Growth members know its exclusive Buy Below price. Plus, they get all my members only Buy and Sell advice on this A-rated company, as well as more than three dozen other top stocks.
But if you aren’t ready to join Blue Chip Growth today, that’s okay. Stay tuned into this blog. I’ll continue revealing my favorite market insights right here throughout the weeks and months to come. However, if you want to know everything you need to begin profiting from China Lodging Group today, don’t hesitate. Join Blue Chip Growth now.