Company Performance - Marriott Vacations reported a revenue decline of 3.2% year-over-year to $1.26 billion, missing analyst estimates of $1.32 billion [2] - Adjusted EBITDA was $170 million, nearly 8% below consensus expectations, raising concerns about profitability [2] - The company’s adjusted earnings per share of $1.69 exceeded expectations by 5.6%, but the market focused on revenue weakness and a decline in conducted tours [2] Market Reaction - Shares of Marriott Vacations fell 20.8% in the morning session following the mixed third-quarter results [1] - The stock has shown volatility, with 14 moves greater than 5% over the past year, indicating significant market impact from this news [4] - The previous notable stock movement occurred 27 days prior, when shares dropped 3.2% due to concerns over trade relations with China [4] Industry Context - The leisure industry, which includes travel, entertainment, and hospitality, is sensitive to economic sentiment and discretionary spending [5] - Recent comments from President Trump regarding China have increased market volatility, particularly affecting leisure stocks [5] - China's new export controls on rare earth materials, essential for high-tech goods, have raised concerns about economic headwinds and potential impacts on consumer spending [5]

Business Overview - The company operates with iconic brands, approximately 120 resorts, and serves around 700,000 owner families[9] - The company's business model includes timeshare and exchange products, multiple brands, perpetual sales centers, and a capital-efficient development model[10] - Approximately 40% of the company's Adjusted EBITDA comes from recurring sources[12, 75] Financial Performance and Guidance - In 2024, the Segment Adjusted EBITDA for Exchange and Third-Party Management was $102 million, with a 46% margin[20] - The company anticipates $150 million to $200 million in annualized Adjusted EBITDA benefits by 2026 through strategic modernization[27, 75] - The company's full year 2025 guidance includes contract sales of $1,760 million to $1,780 million, Adjusted EBITDA of $740 million to $755 million, and Adjusted Free Cash Flow of $235 million to $270 million[70] Growth Strategies - The company aims to drive vacation ownership growth by leveraging strong license relationships[45] - The company is investing in digital capabilities to drive sales and efficiency, with 49% of 2024 tour packages sold digitally and 14% of 2024 contract sales sold non-traditionally[48, 49] - The company is focused on adding first-time buyers, with approximately 95,000 first-time buyers added in the last 5 years[57]

Core Insights - Marriott Vacations Worldwide reported $1.26 billion in revenue for Q3 2025, a year-over-year decline of 3.2% and a surprise of -5.2% compared to the Zacks Consensus Estimate of $1.33 billion [1] - The EPS for the same quarter was $1.69, down from $1.80 a year ago, with a surprise of +3.05% over the consensus estimate of $1.64 [1] Revenue Breakdown - Cost reimbursements revenue was $451 million, below the average estimate of $491 million, representing a year-over-year decline of 4.7% [4] - Rental revenue was $150 million, slightly below the average estimate of $157.8 million, with a year-over-year change of -0.7% [4] - Management and exchange revenue was $214 million, exceeding the average estimate of $211.67 million, showing a year-over-year increase of 3.4% [4] - Sales of vacation ownership products generated $358 million, below the average estimate of $376.71 million, reflecting a year-over-year decline of 7.5% [4] - Financing revenue was $90 million, in line with the average estimate of $90.22 million, with a year-over-year increase of 3.5% [4] Stock Performance - Shares of Marriott Vacations Worldwide have returned +2.4% over the past month, outperforming the Zacks S&P 500 composite's +1% change [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3]

Core Insights - Marriott Vacations Worldwide reported quarterly earnings of $1.69 per share, exceeding the Zacks Consensus Estimate of $1.64 per share, but down from $1.80 per share a year ago, indicating an earnings surprise of +3.05% [1] - The company generated revenues of $1.26 billion for the quarter ended September 2025, missing the Zacks Consensus Estimate by 5.2% and down from $1.31 billion year-over-year [2] - The stock has underperformed, losing approximately 26.2% since the beginning of the year, while the S&P 500 has gained 15.1% [3] Earnings Performance - Over the last four quarters, Marriott Vacations Worldwide has surpassed consensus EPS estimates four times [2] - The company has topped consensus revenue estimates two times over the last four quarters [2] - The current consensus EPS estimate for the upcoming quarter is $1.72 on revenues of $1.35 billion, and for the current fiscal year, it is $6.75 on revenues of $5.12 billion [7] Market Outlook - The stock currently holds a Zacks Rank 4 (Sell), indicating expectations of underperformance in the near future [6] - The estimate revisions trend for the company was unfavorable ahead of the earnings release, which may impact future stock movements [5][6] - The Leisure and Recreation Services industry, to which the company belongs, is currently in the top 31% of Zacks industries, suggesting a favorable industry outlook [8]

Financial Performance - Contract sales for Q3 2025 were $439 million, a decline of 4% compared to $459 million in Q3 2024[4][9] - Revenues excluding cost reimbursements decreased by 2% to $748 million from $766 million year-over-year[7] - The segment margin fell to 18.4%, down 840 basis points from 26.8% in the prior year[7] - Adjusted EBITDA for the quarter was $170 million, a 16% decrease from $232 million in Q3 2024[8][9] - Total revenues for Q3 2025 were $1,263 million, a decrease of 3% compared to $1,305 million in Q3 2024[30] - Adjusted EBITDA for Q3 2025 was $170 million, down 15% from $200 million in Q3 2024[30] - Adjusted net income attributable to common stockholders for Q3 2025 was $66 million, an 8% decrease from $73 million in Q3 2024[37] - Adjusted net income attributable to common stockholders is projected to be between $262 million and $279 million for 2025[15] - Adjusted EBITDA for the nine months ended September 30, 2025, was $565 million, a 4% increase from $545 million in the same period of 2024[53] Liquidity and Cash Flow - The company ended Q3 2025 with $1,428 million in liquidity, including $474 million in cash and cash equivalents[12] - Cash provided by operating activities for the nine months ended September 30, 2025, was $22 million, down from $105 million in the same period of 2024[63] - Cash and cash equivalents as of September 30, 2025, were $474 million, significantly up from $197 million at the end of 2024[61] - Adjusted free cash flow guidance for fiscal year 2025 is projected to be between $235 million and $270 million[64] Sales and Revenue Trends - Full-year 2025 contract sales guidance is set between $1,760 million and $1,780 million, revised from $1,740 million to $1,830 million[15] - Average revenue per interval for Q3 2025 was $37.91, down 3% from $38.93 in Q3 2024[32] - The average revenue per Interval International member for 2025 is projected to be $37.91, a decrease from $39.15 in 2023[68] - Revenue from vacation ownership products for the nine months ended September 30, 2025, was $1,083 million, a 3% increase from $1,048 million in the same period of 2024[53] - Total management and exchange revenue for the nine months ended September 30, 2025, was $648 million, a 2% increase from $633 million in the prior year[59] Expenses and Losses - The company reported a net loss attributable to common stockholders of $2 million, resulting in a diluted loss per share of $0.07[8] - Total expenses for Q3 2025 were $1,230 million, an increase from $1,157 million in Q3 2024[35] - Net loss attributable to common stockholders for Q3 2025 was $(2) million, a decline of 103% from $84 million in Q3 2024[30] - Development profit for Q3 2025 was $72 million, down 32% from $105 million in Q3 2024, resulting in a development profit margin of 20.2%[50] - Rental profit for the nine months ended September 30, 2025, was $102 million, a 21% decrease from $131 million in the same period of 2024[53] Strategic Initiatives - The company expects a $150 million to $200 million Adjusted EBITDA benefit from its modernization program by the end of 2026[5] - The company plans to continue focusing on modernization and restructuring efforts, with $53 million allocated for modernization in Q3 2025[40] - The company plans to continue focusing on strategic opportunities, including acquisitions and strengthening the balance sheet[80] Member and Market Metrics - The number of international members remained stable at 1,499, a 3% decrease from 1,545 in Q3 2024[32] - Total active Interval International members decreased to 1,545,638 in December 2024, down from 1,563,849 in December 2023, a decline of 1.2%[68] - Tours for 2024 totaled 432,716, an increase from 405,825 in 2023, representing a growth of 6.6%[68] Impairments and Adjustments - The company recorded a $31 million impairment charge in both Q3 2025 and Q3 2024[44] - The company began excluding amortization of cloud computing software implementation costs from Adjusted EBITDA for comparability purposes[75] - Adjusted EBITDA is used as an indicator of operating performance, reflecting the company's ability to service debt and fund capital expenditures[77] - Free Cash Flow and Adjusted Free Cash Flow are evaluated as liquidity measures, providing insights into cash generated after capital expenditures[80] - Adjusted development profit margin is calculated by dividing Adjusted development profit by revenues from the Sale of vacation ownership products[73]

Core Insights - Ucore Rare Metals Inc. has signed a Memorandum of Understanding (MOU) with Vacuumschmelze GmbH & Co. KG and eVAC Magnetics LLC to develop a collaborative supply agreement for high-purity rare earth oxides (REOs) [1][4][6] - The partnership aims to secure a stable supply of REOs critical for various industries, including automotive, industrial automation, and defense systems [3][6][7] - Ucore's RapidSX™ refining technology will play a vital role in producing the necessary REOs for VAC and eVAC's operations [6][10] Company Overview - Ucore is advancing North American rare earth separation and refining through its Louisiana Strategic Metals Complex and commercialization of RapidSX™ separation technology [10] - The company received a follow-on award of US$18.4 million from the U.S. Department of Defense in 2025, bringing total funding under its current agreement to US$22.4 million [10] Strategic Importance - The collaboration is expected to enhance the strategic position of VAC and eVAC in the global rare earth supply chain, ensuring long-term access to critical raw materials [7] - The MOU was signed at the G7 Energy and Environment Minister's Summit, highlighting its significance on an international platform [8] Future Plans - The parties will define the structure and commercial terms for a definitive long-term agreement within nine months, supported by regular progress reviews [9]

Core Viewpoint - Wall Street anticipates a year-over-year decline in earnings for Marriott Vacations Worldwide despite higher revenues, with actual results being crucial for stock price movement [1][2]. Earnings Expectations - The upcoming earnings report is expected on November 5, with a consensus EPS estimate of $1.64, reflecting an 8.9% decrease year-over-year. Revenues are projected at $1.33 billion, a 2.1% increase from the previous year [3][12]. Estimate Revisions - The consensus EPS estimate has been revised 0.87% higher in the last 30 days, indicating a positive reassessment by analysts [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model shows a positive Earnings ESP of +0.80% for Marriott Vacations Worldwide, suggesting a likelihood of beating the consensus EPS estimate [12]. Historical Performance - In the last reported quarter, the company exceeded the expected EPS of $1.72 by delivering $1.96, resulting in a surprise of +13.95%. Over the last four quarters, the company has consistently beaten consensus EPS estimates [13][14]. Investment Considerations - While a potential earnings beat is a positive indicator, other factors may influence stock performance, making it essential to consider the broader context [15][17].

Core Insights - Marriott Vacations Worldwide (VAC) has a strong history of exceeding earnings estimates and is well-positioned for continued success in upcoming reports [1][2] Earnings Performance - The company has consistently topped earnings estimates, with an average surprise of 10.18% over the last two quarters [2] - In the most recent quarter, Marriott Vacations reported earnings of $1.96 per share, surpassing the expected $1.72 per share by 13.95%. The previous quarter also saw a positive surprise, with actual earnings of $1.66 per share against an estimate of $1.56 per share, resulting in a 6.41% surprise [3] Earnings Estimates and Predictions - Recent estimates for Marriott Vacations have been trending upward, with a positive Zacks Earnings ESP (Expected Surprise Prediction) indicating a strong likelihood of another earnings beat [6][9] - The current Earnings ESP stands at +0.80%, suggesting that analysts are optimistic about the company's earnings prospects [9] Zacks Rank and Success Rate - The combination of a positive Earnings ESP and a Zacks Rank of 3 (Hold) suggests a high probability of exceeding consensus estimates, with historical data indicating that nearly 70% of stocks with this combination achieve a positive surprise [7][9]

Core Viewpoint - The Zacks Leisure and Recreation Services industry is experiencing growth driven by optimized business processes, partnerships, and digital initiatives, with strong demand for concerts and cruise bookings supporting this trend [1] Industry Overview - The Zacks Leisure and Recreation Services industry includes various recreation providers such as cruise operators, entertainment and media owners, theme park operators, and event organizers, thriving on economic growth and consumer demand [2] Trends Shaping the Industry - The cruise industry is benefiting from strong demand and increasing booking volumes, particularly in North America and Europe, with solid pricing and onboard spending contributing positively [3] - Theme park operators are experiencing improved visitation and rising consumer spending, aided by technology integration like augmented and virtual reality, while live entertainment firms are capitalizing on pent-up demand for events [4] - Rising disposable incomes in the U.S. are boosting leisure travel demand, with a shift towards experiential travel preferences and technological advancements enhancing consumer engagement [5] Industry Ranking and Performance - The Zacks Leisure and Recreation Services industry holds a Zacks Industry Rank of 50, placing it in the top 21% of 243 Zacks industries, indicating positive near-term prospects [6][7] - Despite the positive outlook, the industry has underperformed compared to the broader sector and the S&P 500, with a growth of 10.1% over the past year compared to 13% for the sector and 16.2% for the S&P 500 [10] Valuation Metrics - The industry trades at a forward 12-month price-to-sales (P/S) ratio of 2.49X, lower than the S&P 500's 5.36X and the sector's 2.35X, with historical trading ranges between 1.68X and 6.37X [13] Notable Companies - **Trip.com Group (TCOM)**: Benefiting from a 60% year-over-year surge in international reservations, with strong inbound travel bookings more than doubling; expected sales and earnings growth of 15.5% and 2.8% in 2025 [16][17] - **Carnival Corporation (CCL)**: Experiencing sustained demand and record pricing levels, with forward bookings for 2026 outpacing capacity growth; projected sales and earnings growth of 6.5% and 51.4% in 2025 [20][21] - **Norwegian Cruise Line Holdings (NCLH)**: Strong consumer demand and record advance ticket sales of $4 billion; expected sales and earnings growth of 6% and 14.8% in 2025 [24][25] - **Marriott Vacations Worldwide (VAC)**: Anticipating benefits from strong leisure travel demand and digitization initiatives, with expected sales and earnings growth of 3% in 2025 [28][29]

Core Insights - The comparison between Marriott Vacations Worldwide (VAC) and Airbnb, Inc. (ABNB) indicates that VAC presents a better value opportunity for investors at this time [1] Valuation Metrics - VAC has a forward P/E ratio of 9.62, significantly lower than ABNB's forward P/E of 28.17, suggesting that VAC is undervalued relative to its earnings potential [5] - The PEG ratio for VAC is 0.94, while ABNB's PEG ratio is 2.17, indicating that VAC is expected to grow its earnings at a more favorable rate compared to its current valuation [5] - VAC's P/B ratio stands at 0.9, contrasting sharply with ABNB's P/B ratio of 9.49, further highlighting VAC's undervaluation [6] Earnings Outlook - VAC is currently experiencing an improving earnings outlook, which is reflected in its Zacks Rank of 2 (Buy), while ABNB holds a Zacks Rank of 3 (Hold) [3][7]