Marriott's Brand Prowess Intact as Industry Demand Normalizes After a Strong Recovery

We expect Marriott's global share to increase further over the next several years, due to its strong intangible asset, source of its wide moat, which is endeared by both hotel owners and travelers. In the past few years, Marriott has renovated a meaningful percentage of core Marriott and Courtyard hotels, and since 2019, has added several new brands, which support our constructive stance along with a favorable next-generation traveler position. In fact, recent brands StudioRes, City Express, and Four Points, not only extend Marriott's reach into the midscale and extended-stay segments but could also add several hundred hotels each over the next several years. Also, we see Marriott as having an industry-leading loyalty program, with 196 million members (as of Dec. 31, 2023), which incentivizes third-party hotel owners to join the company's brands. Additionally, we believe the acquisition of Starwood (closed in September 2016) and partnership with MGM's Vegas portfolio (signed in June 2023) has strengthened Marriott's long-term brand advantage, as Starwood's global luxury portfolio and MGM's leading presence in the gaming mecca complement Marriott's dominant upper-scale position in North America.