The chairman and CEO of Wyndam Worldwide told CNBC Tuesday that he’s bullish on the economy this year, unexpectedly.
“I think everyone went in a little cautions, going into 2010, but 2010 has been very strong,” said Stephen Holmes. “All the indicators, all the fundamentals are behind the business growth.”
Wyndam reported better-than-expected quarterly earnings on Tuesday. Revenue is up nearly 5 percent this year over last: $1.078 billion in the third quarter versus $1.02 billion a year ago.
Hotels represent a fifth of the company’s business, but half of its revenue comes from time-shares: Wyndam is the world’s biggest time-share operator. Another big piece of its revenue comes from vacation exchanges and rentals.
“Wyndam is clearly a diversified hospitality company,” said Robert LaFleur, a gaming, lodging and leisure analyst for Hudson Securities, which makes a market in securities of Wyndam Worldwide.
“The hotel industry had very strong [quarter], the vacation rental business in Europe is always great, because Europeans vacation all the time. Even the time-share business—a business that some investors love to hate—was very strong in the quarter,” added LaFleur. LaFleur has a buy rating and a $35 target price on Wyndam.
“And really the upside there, one of the big items was the reduction in their loan loss provision, which shows you that the time-share funding business is much, much stronger than people anticipated.”