Bloomberg TV: How to Trade Marriott Options Insight

Benchmark’s Kevin R. Kelly went on Bloomberg to discuss how to trade Marriott Hotels, traded on the Nasdaq under the symbol MAR. Marriott is the world’s largest hotel chain with around 1.1 million rooms globally. The company is seeking to secure this lead with partners such as Alibaba to grow its global digital and brand presence and capture more direct bookings.

Benchmark’s Kevin Kelly discusses an options trade on MAR to position into the company’s upcoming earnings report. Marriott’s earnings expansion hinges on increasing the number of fee-based hotels, particularly in overseas markets, and upgrading low-performing brands, such as Sheraton.

Marriott International is on track to achieve $250 million in annual savings and $1.5 billion in asset sales this year after the Starwood merger. The world’s largest hotel operator is increasingly more asset-light as it expands fee revenue through contract signings under its 30 brands. This, coupled with cost cuts, supports wider profit margins. The hotel giant still needs to plan for revenue and profit growth beyond 2018 with better digital investments and expansion of brand offerings to include midscale products.

  • Marriott International (MAR) is a constituent of the HOTL Index

  • Trade: Risk Reversal

  • Sell the July MAR  $130 Put for $4.4

  • Buy the July MAR $140 Call for $7.70

  • Trade Costs $3.30 for Unlimited Upside

Click the play button to watch full video below:

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2018-06-02T18:24:57-04:00