No. 4 – Hyatt
Cramer admits that Hyatt reported a very strong quarter at the end of April, however, of the four stocks on this list, Hyatt is his least favorite, simply because he thinks others have more significant catalysts.
"Plus, it's uberexpensive, selling for 53 times earnings. It's just not the hotel stock I'd own here," Cramer said.
No. 3 – Marriott
Cramer says there's plenty to like about Marriott; in fact he calls it a fabulous operator.
"Marriott's most recent quarter was a terrific beat and raise, and on top of everything else, it generates a ton of cash, cash that can be used to buy back stock. Year-to-date, the company's already repurchased 9 million shares for $467 million, which is equal to 4.6 percent of the float, and they've still got over 30 million shares left in their buyback authorization."
Although Cramer says he could endorse this stock for the buyback, he thinks there are still better places to play.
Now, Cramer's call isn't a referendum on the company; it's simply a referendum on the stock. "Shares have been chugging higher all year, up nearly 20 percent for 2014." Considering the gains, Cramer would rather put money in rivals, simply because he thinks they have more upside.
No. 2 – Hilton
Cramer likes Hilton as a turnaround story. "The company was taken private back in 2007," he said, "but then it came public again last December at $20 a share, and it's now a much better balance sheet story."
Cramer explained that Hilton has refinanced debt and the board is looking to improve the grade of their bonds, which would allow the company to save money on interest payments.
The appeal of a so-called better balance sheet story is that savings outlined above typically go right to the bottom line. "I think of Hilton as a C student who is becoming a B student."
Like a teacher, typically, the Street rewards improvement. Therefore, "I think Hilton has a ton of upside as the company improves itself."
However, Hilton isn't Cramer's favorite stock in the space.
No. 1 - Starwood
"My favorite company and my favorite stock in the industry is Starwood Hotels & Resorts," Cramer said.
In this case, Cramer is a big fan of the business model.
"The thing I adore about this company is that, under the leadership of CEO Frits van Paasschen, Starwood has pioneered what's known as the asset-light business model."
In other words, even though the company runs 1,200 hotels, they only own or lease a limited amount of real estate on which the hotels are built.
"The rest they either manage without owning the property or farm out as franchises," Cramer said. "This is a terrific way for a hotel company to grow its business rapidly without having to spend a fortune on real estate development."
Cramer said Starwood is also very shareholder friendly with a buyback underway as well as a special dividend.
Although the stock has stalled, Cramer believes it has to do with the buyback.
"The company didn't spend a single penny buying back stock in the first quarter. I don't know if management simply wants to wait for a lower price or what, but I think the cessation of the buyback is a big reason why this stock has done nothing year-to-date."
"Here's the good news, though, Starwood still has $615 million left in its repurchase authorization, equal to 4 percent of the market cap, and if they start buying again, I think that could ignite the stock," he said.
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All told, Cramer's favorite hotel stock is Starwood. With its 5 percent yield, clever business model, buybacks and the bull market in lodging, "What's not to like?"