Choice Hotels International (NYSE:CHH) Releases Earnings Results, Beats Expectations By $0.05 EPS

Choice Hotels International (NYSE:CHH) issued its quarterly earnings results on Wednesday. The company reported $2.02 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $1.97 by $0.05, Briefing.com reports. The business had revenue of $440.76 million for the quarter, compared to the consensus estimate of $431.52 million. Choice Hotels International had a return on equity of 281.98% and a net margin of 21.55%.The firm’s quarterly revenue was up 3.4% compared to the same quarter last year. During the same quarter in the prior year, the business posted $1.92 earnings per share. Choice Hotels International updated its FY 2026 guidance to 6.860-7.100 EPS.

Here are the key takeaways from Choice Hotels International’s conference call:

• Raised full-year guidance for adjusted EBITDA to $635–$650 million, U.S. RevPAR growth to 0%–1.25%, global RevPAR growth to 0%–1%, and global net rooms growth to approximately 1.5%.
• U.S. rooms growth trends improved, with openings up 27% year over year, exits down 50%, and U.S. franchise agreements up 30%; management expects positive U.S. net rooms growth for 2026.
• Second-quarter adjusted EBITDA rose 6% to $175 million and adjusted EPS increased 5% to $2.02, supported by higher U.S. royalties, royalty-rate expansion, franchise services revenue, and international growth.
• Choice is accelerating its transition to an asset-light franchising model, with hotel-development outlays down 80% in the first half and initial asset dispositions expected in the first half of 2027, potentially improving future cash flow.
• Despite the stronger operating outlook, adjusted EPS guidance was set at $6.86–$7.10 because of higher expected interest expense and a higher effective tax rate; second-half comparisons also include a roughly $9.5 million unfavorable impact from nonrecurring prior-year liquidated damages.

Choice Hotels International Price Performance

CHH stock traded down $2.12 during mid-day trading on Thursday, reaching $109.67. The company’s stock had a trading volume of 459,356 shares, compared to its average volume of 661,315. The company has a current ratio of 0.95, a quick ratio of 0.95 and a debt-to-equity ratio of 14.58. Choice Hotels International has a fifty-two week low of $84.04 and a fifty-two week high of $125.35. The company’s 50 day moving average is $110.57 and its two-hundred day moving average is $108.32. The stock has a market cap of $4.99 billion, a PE ratio of 14.78, a P/E/G ratio of 4.31 and a beta of 0.67.

Choice Hotels International Dividend Announcement

The business also recently disclosed a quarterly dividend, which was paid on Wednesday, July 15th. Shareholders of record on Wednesday, July 1st were issued a dividend of $0.2875 per share. This represents a $1.15 annualized dividend and a yield of 1.0%. The ex-dividend date of this dividend was Wednesday, July 1st. Choice Hotels International’s dividend payout ratio (DPR) is presently 15.50%.

Insider Activity at Choice Hotels International

In other news, CFO Scott E. Oaksmith sold 2,000 shares of Choice Hotels International stock in a transaction on Friday, June 12th. The shares were sold at an average price of $110.00, for a total transaction of $220,000.00. Following the completion of the sale, the chief financial officer directly owned 35,172 shares of the company’s stock, valued at approximately $3,868,920. The trade was a 5.38% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through the SEC website. 23.87% of the stock is currently owned by company insiders.

Institutional Trading of Choice Hotels International

A number of hedge funds have recently added to or reduced their stakes in the business. Elevation Point Wealth Partners LLC purchased a new stake in Choice Hotels International in the 4th quarter worth about $240,000. Campbell & CO Investment Adviser LLC acquired a new position in Choice Hotels International during the 4th quarter valued at about $269,000. Armistice Capital LLC acquired a new stake in shares of Choice Hotels International in the 3rd quarter valued at approximately $293,000. PharVision Advisers LLC bought a new position in Choice Hotels International in the third quarter valued at approximately $229,000. Finally, Virtu Financial LLC acquired a new stake in Choice Hotels International in the 3rd quarter valued at $252,000. 65.57% of the stock is owned by institutional investors and hedge funds.

Key Headlines Impacting Choice Hotels International

Here are the key news stories impacting Choice Hotels International this week:

• Positive Sentiment: Choice Hotels reported adjusted EPS of $2.02, exceeding the $1.97 analyst consensus and rising from $1.92 a year earlier. Revenue increased 3.4% year over year to $440.76 million, also surpassing expectations. Choice Hotels International Reports Second Quarter 2026 Results
• Positive Sentiment: Quarterly EBITDA rose 6.3% to $175.4 million, supported by higher domestic royalty pricing, international portfolio expansion and monetization of non-room platforms. Management also cited improved U.S. royalty performance and raised its full-year EBITDA guidance midpoint to $642.5 million. Choice Hotels: Solid Performance and Improved Prospects
• Positive Sentiment: Global net rooms grew 2.6%, with U.S. net rooms growth improving for the second consecutive quarter. The asset-light franchising model continues to support royalty growth while limiting capital requirements. Choice Hotels Earnings Call Signals Asset-Light Momentum
• Neutral Sentiment: Management raised its full-year 2026 royalty-rate and global net-unit-growth targets, signaling improved operating prospects, although investors will continue to monitor lodging demand and execution across the expanding international portfolio.
• Negative Sentiment: Full-year 2026 EPS guidance of $6.86–$7.10 has a midpoint of $6.98, below the roughly $7.10 analyst consensus. The lower end of the range also leaves limited room for upside, which may be offsetting the quarterly earnings and revenue beats. Choice Hotels Q2 Earnings and Revenues Surpass Estimates

Wall Street Analyst Weigh In

Several research analysts have recently weighed in on the company. Robert W. Baird set a $128.00 price target on Choice Hotels International in a research note on Monday, May 11th. Morgan Stanley dropped their price objective on Choice Hotels International from $87.00 to $86.00 and set an “underweight” rating for the company in a research note on Tuesday, May 12th. Wells Fargo & Company lifted their target price on shares of Choice Hotels International from $98.00 to $99.00 and gave the company an “underweight” rating in a research note on Thursday, July 16th. JPMorgan Chase & Co. raised their price objective on Choice Hotels International from $116.00 to $118.00 and gave the company a “neutral” rating in a research report on Tuesday, July 21st. Finally, Barclays lifted their price objective on Choice Hotels International from $101.00 to $102.00 and gave the stock an “underweight” rating in a report on Thursday. Two research analysts have rated the stock with a Buy rating, eight have given a Hold rating and four have given a Sell rating to the stock. Based on data from MarketBeat, the company currently has a consensus rating of “Reduce” and a consensus target price of $111.92.

About Choice Hotels International

Choice Hotels International, Inc is a hospitality franchisor specializing in the development and support of lodging brands across the economy, midscale and upscale segments. Through a network of franchisees, Choice Hotels supplies proprietary reservation and distribution systems, comprehensive marketing programs, and operational support services. The company’s core activities include brand management, franchise development, and technology-driven revenue optimization tools designed to enhance guest acquisition and retention for its partners.

Founded in 1939 as Quality Courts United, the company rebranded to Choice Hotels International in 1982 to reflect its expanding brand portfolio and global ambitions.