Starwood Hotels Quarterly Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Starwood Hotels (NYSE:HOT) will unveil its latest earnings on Thursday, July 26, 2012. Starwood Hotels & Resorts Worldwide operates in the hotel and leisure business. Its brand names include St. Regis, The Luxury Collection, W and Westin.

Starwood Hotels Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for profit of 61 cents per share, a rise of 22% from the company’s actual earnings for the same quarter a year ago. The average estimate is the same as three months ago. Between one and three months ago, the average estimate was unchanged. It also has not changed during the last month. Analysts are projecting profit to rise by 26.4% compared to last year’s $2.44.

Past Earnings Performance: Last quarter, the company beat estimates by 10 cents, coming in at net income of 63 cents a share versus the estimate of profit of 53 cents a share. It marked the fourth straight quarter of beating estimates.

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A Look Back: In the first quarter, profit rose more than fourfold to $128 million (65 cents a share) from $28 million (14 cents a share) the year earlier, exceeding analyst expectations. Revenue rose 32.4% to $1.72 billion from $1.29 billion.

Stock Price Performance: Between April 25, 2012 and July 23, 2012, the stock price fell $6.13 (-10.78%), from $56.85 to $50.72. The stock price saw one of its best stretches over the last year between January 17, 2012 and January 25, 2012, when shares rose for seven straight days, increasing 8.2% (+$4.15) over that span. It saw one of its worst periods between March 26, 2012 and April 4, 2012 when shares fell for eight straight days, dropping 6.1% (-$3.60) over that span.

Wall St. Revenue Expectations: Analysts predict a rise of 9.1% in revenue from the year-earlier quarter to $1.56 billion.

Key Stats:

On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 10.6% in the second quarter of the last fiscal year, 9.3% in the third quarter of the last fiscal year and 14.3% in the fourth quarter of the last fiscal year before increasing again in the first quarter.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.05 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term. The company regressed in this liquidity measure from 1.27 in the fourth quarter of the last fiscal year to the last quarter driven in part by an increase in liabilities. Current liabilities increased 18% to $2.35 billion while assets decreased 2.8% to $2.46 billion.

Analyst Ratings: With 13 analysts rating the stock a buy, none rating it a sell and eight rating the stock a hold, there are indications of a bullish stance by analysts.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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