MCLEAN, Va. - Hilton Worldwide Holdings Inc. (NYSE: NYSE:HLT), a global hospitality company, has announced its intention to offer $1 billion in senior notes due 2033 through its indirect subsidiary, Hilton Domestic Operating Company Inc. The offering aims to raise funds for general corporate purposes.
The senior notes will not be registered under the Securities Act of 1933, as amended, or any state securities laws, and will be available only to qualified institutional buyers and certain non-U.S. persons in offshore transactions, based on exemptions provided by Rule 144A and Regulation S under the Securities Act.
Hilton has clarified that this announcement is not an offer to sell or a solicitation of an offer to buy any securities. The issuance and sale of the notes will be unlawful in any jurisdiction where such an offer, solicitation, or sale would be prohibited.
The press release also contains forward-looking statements regarding Hilton's business performance and financial outcomes. These statements are subject to a variety of risks and uncertainties, which could cause actual results to differ materially from those projected. Factors that could affect outcomes include industry risks, economic conditions, labor challenges, competition, and Hilton's level of indebtedness, among others. Hilton has directed interested parties to its SEC filings for a more comprehensive list of risk factors.
This news is based on a press release statement from Hilton Worldwide Holdings Inc. and does not constitute an offer to sell or a solicitation of an offer to buy any securities.
In other recent news, Hilton Worldwide Holdings Inc. has demonstrated strong financial performance in the second quarter, surpassing market expectations. The company reported an adjusted EBITDA of $917 million, which outperformed both Mizuho's projection of $901 million and Hilton's own guidance, ranging between $890 million and $910 million. The company's net unit growth increased by 6.1% year-over-year, with new acquisitions and partnerships contributing to this growth. However, Hilton has revised its full-year revenue per available room (RevPAR) guidance, narrowing it from a 2-4% increase to 2-3%.
In response to these developments, both Morgan Stanley (NYSE:MS) and Mizuho Securities have adjusted their price targets for Hilton, with Morgan Stanley maintaining an Overweight rating and a new target of $233, and Mizuho retaining an Outperform rating with a target of $237. These adjustments are based on Hilton's recent performance and changes in the broader economic outlook.
Despite a softer macro environment and reduced RevPAR guidance, Hilton maintains a positive outlook, expecting around 10% EBITDA growth for the full year. The company's portfolio has expanded beyond 8,000 hotels, and Hilton projects full-year net unit growth of 7% to 7.5%. These results and projections reflect the company's recent strategic acquisitions and partnerships, as well as its strong performance in the Europe, Middle East, Africa (EMEA), and Asia Pacific (APAC) regions.
InvestingPro Insights
In light of Hilton Worldwide Holdings Inc.'s (NYSE: HLT) recent announcement to offer $1 billion in senior notes, it's pertinent to consider the company's financial health and market performance. InvestingPro data indicates that Hilton has a substantial market capitalization of $52.8 billion, underscoring its significant presence in the hospitality industry. With a P/E ratio of 44.89, the company trades at a high earnings multiple, which may reflect investors' expectations for future growth or the company's strong market position.
InvestingPro Tips suggest that Hilton's management has been actively engaging in share buybacks, which can be an indicator of the leadership's confidence in the company's value. Additionally, Hilton's impressive gross profit margin of 75.38% over the last twelve months as of Q2 2024 showcases its ability to maintain profitability in a competitive sector. These financial metrics and strategic decisions are crucial for investors to consider, especially in the context of the company's new debt offering and its overall capital structure.
For those interested in a deeper dive into Hilton's financials and market performance, InvestingPro offers additional tips, including insights into the company's debt levels, valuation multiples, and analysts' earnings revisions. In total, there are 13 additional InvestingPro Tips available for Hilton, providing a comprehensive analysis for informed investment decisions.
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