Choice’s Radisson Synergies Tracking Higher, as Demand Growth Continues in 2023 at a Moderate Level

We don’t anticipate a material change to Choice’s $122 fair value estimate, as stronger Radisson synergies are offset by slightly lower revenue per available room, or revPAR, and unit growth in 2023. Choice’s fourth-quarter revPAR came in at 120% of 2019’s level, directly in line with our forecast and up from 115% in the prior quarter. Aided by a strong domestic leisure mix, Choice’s revPAR recovery continued to outpace the 108% and 105% marks of Hilton and Marriott, respectively. That said, Choice’s 2023 revPAR growth guidance of 2% tracked below our 5% estimate (which we plan to lower to around 3%) and the 4%-8% and 6%-11% targets of Hilton and Marriott, respectively, as the higher group and business mix of these peers starts to see a stronger recovery.