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We recently published an article titled 10 Best Cruise Stocks to Buy Right Now. On January 16, Morgan Stanley raised its price target on Travel + Leisure Co. (NYSE:TNL) to $80 from $68 while maintaining an Overweight rating. In its 2026 sector outlook, the firm noted that gaming, lodging, and leisure fundamentals were relatively muted in 2025, with pockets of resilience concentrated among companies catering to older and higher-income consumers. Looking ahead, Morgan Stanley expects similar underlying tren ...

Core Viewpoint - Travel + Leisure (TNL) shares have performed exceptionally well, increasing nearly 40% over the past year, bolstered by solid quarterly results reported by the company [1] Company Performance - The timeshare business model of Travel + Leisure has a recurring revenue nature, which has provided insulation against market volatility [1]

Core Viewpoint - Nestle is negotiating to divest its remaining ice cream businesses as part of CEO Philipp Navratil's strategy to streamline the company [1] Group 1 - The decision to sell the ice cream segment aligns with the company's broader efforts to focus on core areas of its business [1] - This move is part of a larger trend in the consumer food industry where companies are reassessing their product portfolios to enhance operational efficiency [1] - The divestiture reflects Nestle's commitment to optimizing its operations and potentially reallocating resources to more profitable segments [1]

Core Insights - Renault forecasts a decline in margins for 2026, projecting around 5.5% compared to 6.3% in the previous year, due to increasing price pressures from competitors [1][2][3] - The company reported a 15% drop in operating profit for the last year, attributed to pricing pressures that accounted for over 700 million euros of the profit decline [1][2][3] Financial Performance - Renault's operating profit for 2025 was 3.6 billion euros ($4.24 billion), aligning with analyst expectations [1][2] - The group recorded a full-year net loss of 10.9 billion euros, its first loss in five years, primarily due to a one-off writedown of 9.3 billion euros related to its stake in Nissan [1][2][3] - Revenue increased by 3% year-on-year to 57.9 billion euros, with sales volumes rising by 3.2% to 2.34 million vehicles in 2025 [1][2][3] Market Environment - The automotive market in Europe is becoming increasingly competitive, particularly with the entry of more Chinese brands and aggressive strategies from rivals like Stellantis [1][2] - Renault aims to combat this competition by focusing on cost reduction, targeting a decrease of around 400 euros per vehicle in variable costs [1][2][3] Strategic Outlook - The company plans to leverage its Duster SUV to enhance its presence in the Indian market while also expanding in South America [1][2] - Renault's management expressed confidence in sustaining growth in Europe despite the strong competition from Chinese manufacturers [1][2][3]

Business Overview - As of December 31, 2025, Travel + Leisure Co. had 797,000 owner families and over 280 vacation club resort locations, making it the world's largest vacation ownership business [19]. - The company operates a diverse inventory sourcing model, which has significantly increased return on invested capital since 2010 [34]. - The Vacation Ownership segment focuses on developing, marketing, and selling vacation ownership interests (VOIs) to consumers, along with providing consumer financing and property management services [211]. Revenue Sources - In 2025, the company generated 46% of its revenues from vacation ownership sales, 40% from fee-for-service revenue, 11% from consumer financing, and 3% from other ancillary revenue streams [24]. - The Travel and Membership segment generates revenue primarily from annual membership dues and fees for facilitating exchange transactions, with no single customer accounting for more than 10% of revenues in 2025 [57]. - Revenue from vacation exchange fees is traditionally higher in the first quarter, aligning with members' vacation planning [63]. Vacation Ownership Sales - During 2025, 68% of vacation ownership interest (VOI) sales were financed, down from 71% in 2024, with gross VOI sales amounting to $2.33 billion [42]. - The average down payment on financed VOI sales was 22% in 2025, compared to 20% in 2024 [41]. - VOI upgrade sales represented 72% of net VOI sales in 2025, indicating strong performance in marketing to existing owners [37]. - Travel + Leisure Co. aims to enhance its upgrade pipeline through new owner sales, with new owners typically doubling their initial VOI purchase within six years [31]. Customer Engagement and Loyalty - The Wyndham Hotels loyalty program had approximately 121 million enrolled members as of September 30, 2025, providing a substantial customer sourcing opportunity for future VOI sales [32]. - The company seeks to enhance its core exchange business by increasing member engagement and reducing churn through expanded product offerings [55]. Environmental Sustainability - As of December 31, 2024, the company has reduced its Scope 1 + Scope 2 GHG emissions intensity by 39% and increased renewable energy consumption to 3% [88]. - The company aims to reduce GHG emissions intensity by 40% by 2025 compared to the 2010 baseline [91]. - The company achieved its goal of planting two million trees two years ahead of schedule in partnership with the Arbor Day Foundation [88]. - The company has publicly stated goals for environmental sustainability, including reducing water intensity and GHG emissions, which may increase operational costs [169]. Risks and Challenges - The company faces numerous risks in the timeshare and leisure travel industries, including increased operating costs and changes in consumer travel patterns [133]. - Financial difficulties among customers, exacerbated during economic downturns, could lead to increased defaults on vacation ownership loans [139]. - The company is subject to risks related to its vacation ownership receivables portfolio, including potential increases in loan loss reserves due to defaults [138]. - Cybersecurity threats pose significant risks to the integrity of customer and proprietary data, which could disrupt business operations and damage reputation [143]. - The company is experiencing elevated delinquencies in its loan portfolio, impacting performance despite improved marketing criteria and sales efficiencies [207]. Strategic Initiatives - Travel + Leisure Co. plans to leverage relationships with leading leisure and hospitality brands to expand its market presence and support lead generation for new owner tours [33]. - The company is expanding its travel clubs and vacation ownership brands, including launching sports-themed resorts, which involves greater risks and resource requirements compared to its core business [128]. - A strategic review in 2025 identified 17 resorts needing significant owner reinvestment, aimed at optimizing the resort portfolio and aligning with owner preferences [212]. Financial Performance - Interest expense improved in 2025 due to better rates on variable rate corporate borrowings and refinancing efforts, including a 25 basis point reduction on the revolving credit facility and a nearly 50 basis point reduction on $350 million notes [208]. - The company completed three term securitizations in 2025, with the third achieving the lowest coupon rate since 2022, indicating business strength amid market volatility [208]. - The Vacation Ownership business experienced higher Gross VOI sales and Adjusted EBITDA growth in 2025 compared to the previous year, driven by increased tour flow and volume per guest (VPGs) recognition [205]. Corporate Governance and Compliance - The company is subject to extensive regulations that may increase costs or require substantial modifications to business practices, potentially impacting financial performance [166]. - The company has established incident response and recovery plans for critical systems, which are periodically tested and evaluated [182]. - The Board receives quarterly updates on cybersecurity risks and mitigation activities from the Chief Technology Officer and Chief Information Security Officer [184].

Financial Data and Key Metrics Changes - In 2025, the company achieved revenue of $4.02 billion, an increase of 4% year-over-year, and EBITDA of $990 million, up 7% year-over-year [17][18] - The fourth quarter revenue was $1.026 billion, with EBITDA of $272 million, reflecting an 8% year-over-year growth [15][18] - Earnings per share (EPS) for the year was $6.34, representing a 10% increase year-over-year [17][18] Business Line Data and Key Metrics Changes - The Vacation Ownership segment saw gross sales rise by 8% year-over-year, driven by a 5% increase in tour flow in the fourth quarter, the strongest level of the year [16][18] - The Travel and Membership segment reported fourth quarter revenue of $148 million, down 6% year-over-year, with EBITDA of $47 million, down 10% [17][18] Market Data and Key Metrics Changes - The company noted strong leisure demand as a key driver for its Vacation Ownership business, with a loyal owner base contributing to predictable cash flow [6][8] - The average FICO score for new originations remained above 740, indicating high-quality loans [17][18] Company Strategy and Development Direction - The company is focused on brand expansion and optimizing its resort portfolio to drive sustainable, profitable growth [6][7] - A Resort Optimization Initiative is underway, which involves closing lower-performing resorts and replacing them with higher-demand properties [12][21] - The company aims to enhance owner experiences through technology investments and partnerships, such as those with Live Nation and Authentic Brands [11][62] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong demand for leisure travel and the company's ability to deliver another year of revenue growth and EBITDA margin expansion in 2026 [14][26] - The company expects EBITDA for 2026 to be in the range of $1.03 billion to $1.055 billion, reflecting 4%-7% year-over-year growth [14][24] Other Important Information - The company returned $449 million to shareholders in 2025 through dividends and share repurchases, with a new $750 million share repurchase authorization approved [19][20] - The company is committed to maintaining a disciplined capital allocation strategy while investing in organic growth [20] Q&A Session Summary Question: Can you elaborate on the optimization initiative and its long-term impact on EBITDA? - Management indicated that 2025 was a catch-up year for the optimization initiative, with expectations for a return to normal growth in subsequent years [30][31] Question: How is the consumer demographic performing currently? - Management noted continued strong demand from consumers, with household incomes above $100,000 and improved FICO scores, reinforcing the value of vacation experiences [39][40] Question: What are the expectations for the Travel and Membership business moving forward? - Management expects the Travel and Membership segment to follow a consistent trend with disciplined cost management, contributing to EBITDA growth [93] Question: What is the anticipated loan loss provision for 2026? - Management expects the loan loss provision to decrease to around 20%, with a long-term goal of settling into the high teens [90][91] Question: Can you provide insights on the new brand launches and their expected contributions? - Management anticipates that new brands like Sports Illustrated and Eddie Bauer will grow as a percentage of overall sales, contributing positively to future growth [72][74]

Financial Data and Key Metrics Changes - In 2025, the company achieved revenue of $4.02 billion, an increase of 4% year-over-year, and EBITDA of $990 million, reflecting a 7% growth [17][18] - The fourth quarter revenue was $1.026 billion, with EBITDA of $272 million, marking an 8% year-over-year increase [15][16] - Earnings per share (EPS) for the year was $6.34, up 10% from the previous year [18] Business Line Data and Key Metrics Changes - The Vacation Ownership segment saw gross sales rise by 8% year-over-year, driven by a 5% increase in tour flow during the fourth quarter [16][18] - The Travel and Membership segment reported revenue of $148 million in the fourth quarter, down 6% year-over-year, with EBITDA of $47 million, a 10% decline [17] Market Data and Key Metrics Changes - The company noted strong leisure demand continuing into 2026, with early trends in Q1 consistent with expectations [14] - The average volume per guest (VPG) was reported at $3,359, up 6% year-over-year, indicating strong sales execution [16][18] Company Strategy and Development Direction - The company is focused on brand expansion and optimizing its resort portfolio to ensure sustainable growth beyond 2026 [6][7] - A Resort Optimization Initiative is underway, which involves closing underperforming resorts and replacing them with higher-demand properties [12][21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in delivering another year of revenue growth and EBITDA margin expansion in 2026, with EBITDA expected to be between $1.03 billion and $1.055 billion [14][25] - The company anticipates a continued focus on enhancing owner experiences and leveraging technology to improve operations [11][12] Other Important Information - The company returned $449 million to shareholders in 2025 through dividends and share repurchases, reflecting a commitment to disciplined capital allocation [19][20] - A new $750 million share repurchase authorization was approved, indicating confidence in the company's valuation [20] Q&A Session Summary Question: Can you elaborate on the optimization initiative and its long-term impact on EBITDA? - Management indicated that 2025 was a catch-up year for the optimization initiative, with expectations for a return to normal growth in subsequent years [30][31] Question: How is the consumer demographic performing currently? - Management noted no significant changes in consumer demand, with household incomes rising above $100,000 and improved FICO scores contributing to strong performance [40][41] Question: What are the expectations for the loan loss provision in 2026? - The loan loss provision is expected to decrease to around 20%, with a long-term goal of settling into the high teens [44][92] Question: What is the outlook for the Travel and Membership business? - The Travel and Membership segment is expected to follow a consistent trend with disciplined cost management, contributing to EBITDA growth [94] Question: What is the sales contribution from new brands like Sports Illustrated and Eddie Bauer? - Management anticipates that these new brands will grow to represent a larger percentage of overall sales, with expectations for significant growth in the coming years [73][75]

Financial Data and Key Metrics Changes - In 2025, the company achieved a revenue growth of 4% and an EBITDA growth of 7% compared to the previous year [5][17] - The fourth quarter revenue was $1.026 billion, with an EBITDA of $272 million, reflecting an 8% year-over-year growth [14][17] - Earnings per share (EPS) for the year was $6.34, representing a 10% increase year-over-year [17] Business Line Data and Key Metrics Changes - The Vacation Ownership business saw gross sales growth of 8%, driven by a 5% increase in tour flow in the fourth quarter, marking the strongest year-over-year growth for the year [6][15] - The Travel and Membership segment reported a revenue of $148 million in the fourth quarter, down 6% year-over-year, with EBITDA of $47 million, down 10% [16] Market Data and Key Metrics Changes - The company noted strong leisure demand continuing into 2026, with expectations for gross VOI sales to increase by 1%-5% year-over-year [23] - The average volume per guest is expected to be in the range of $3,175-$3,275, slightly lower than the previous year [23] Company Strategy and Development Direction - The company is focused on brand expansion, optimizing its resort portfolio, and enhancing the owner experience through technology and partnerships [4][10] - The Resort Optimization Initiative aims to remove lower-demand resorts and replace them with higher-demand properties, which is expected to improve financial health and owner satisfaction [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong demand for leisure travel and the company's ability to deliver another year of revenue growth and EBITDA margin expansion in 2026 [13][24] - The company anticipates a net EBITDA benefit from the Resort Optimization Initiative, projecting EBITDA in the range of $1.03 billion-$1.055 billion for 2026 [23][24] Other Important Information - The company returned $449 million to shareholders through dividends and share repurchases in 2025, with a new $750 million share repurchase authorization approved [18][19] - The company is investing in technology to enhance the vacation experience and deepen owner engagement [10][11] Q&A Session Summary Question: Can you elaborate on the optimization initiative and its long-term impact on EBITDA? - Management indicated that 2025 was a catch-up year for the optimization initiative, with expectations for a return to normal growth in subsequent years [28] Question: How is the consumer demographic performing currently? - Management noted continued strong demand from consumers, with household incomes above $100,000 and improved FICO scores, contributing to positive performance [38] Question: What are the expectations for the loan loss provision in 2026? - The company expects the loan loss provision to decrease to around 20%, with a trajectory towards the high teens over time [90] Question: What is the outlook for the Travel and Membership business? - The company models the Travel and Membership business to follow the 2025 trend line, focusing on disciplined cost management [92] Question: What is the sales contribution from new brands like Sports Illustrated and Eddie Bauer? - Management anticipates that these new brands will grow as a percentage of overall sales, aiming for high single digits this year and moving towards double digits in the coming years [72]

Core Insights - Travel + Leisure Co. (TNL) reported quarterly earnings of $1.83 per share, matching the Zacks Consensus Estimate and showing an increase from $1.72 per share a year ago, resulting in an earnings surprise of +0.11% [1] - The company achieved revenues of $1.03 billion for the quarter ended December 2025, exceeding the Zacks Consensus Estimate by 2.65% and up from $971 million in the previous year [2] - Travel Leisure Co. has surpassed consensus EPS estimates three times over the last four quarters, indicating a positive trend in earnings performance [2] Earnings Outlook - The sustainability of the stock's price movement will depend on management's commentary during the earnings call and future earnings expectations [3] - The current consensus EPS estimate for the upcoming quarter is $1.29 on revenues of $966.58 million, while for the current fiscal year, it is $7.45 on revenues of $4.15 billion [7] Industry Context - The Leisure and Recreation Services industry, to which Travel Leisure Co. belongs, is currently ranked in the bottom 21% of over 250 Zacks industries, which may impact stock performance [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, suggesting that industry outlook can significantly affect stock performance [5][8]