Hilton Grand Vacations (US:HGV) ZACKSยท2025-01-07 16:06Core Insights - Hilton Grand Vacations Inc. (HGV) is focusing on diversifying its product portfolio and expanding its global market reach through strategic acquisitions and partnerships [1] - The company's shares have gained 6.2% over the past three months, underperforming the Zacks Consumer Discretionary sector but outperforming the Zacks Hotels and Motels industry and the S&P 500 Index [2] - The Zacks Consensus Estimate for HGV's 2025 earnings per share (EPS) has decreased to $3.55 from $3.63, indicating a year-over-year growth of 3.4% [3] Growth Driving Factors - HGV is engaging in incremental buyouts and partnerships to diversify its product offerings, including the acquisition of Bluegreen Vacations Holding Corporation for approximately $1.6 billion, which adds nearly 200 properties in 14 new regions and eight new states [5] - The company has entered into a 10-year exclusive marketing agreement with Bass Pro Shops to market vacation packages, with sales and marketing operations at 132 locations as of September 30, 2024 [6] - HGV is undergoing rebranding initiatives, with 80% of Diamond properties rebranded in 2024 and plans to rebrand the majority of Bluegreen properties by 2026 [8] Shareholder Value and Financial Performance - HGV has a balanced capital allocation strategy, repurchasing 7.4 million shares for $307 million during the first nine months of 2024 [10] - The company's trailing 12-month return on equity (ROE) is 16.4%, significantly higher than the industry's 5.4%, indicating efficient use of shareholders' funds [11] Challenges - HGV is facing high operating expenses, with total operating expenses increasing to $3.37 billion from $2.50 billion year over year during the first nine months of 2024 [12]