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On Friday, Goldman Sachs analyst Lizzie Dove increased the price target for Hilton Grand Vacations shares (NYSE:HGV) to $34, up from the previous target of $30, while maintaining a Sell rating on the stock. Currently trading at $36.77, the stock sits between analyst targets ranging from $30 to $70. This adjustment follows Hilton Grand Vacations’ first-quarter earnings, which surpassed expectations without any adjustments to their guidance. According to InvestingPro data, the company’s current valuation appears to be near its Fair Value.
The company’s financial performance was notably stronger than that of competitor TNL, which reported last week. With revenue growth of 24.3% and a healthy current ratio of 4.23, Hilton Grand Vacations did not exhibit any of the early warning signs often associated with timeshare consumer behavior, such as declining close rates, weakness in new buyer volume per guest (VPG), or increases in delinquencies. InvestingPro analysis reveals 8 additional key insights about HGV’s financial health and market position.
Dove’s analysis suggests that the timeshare consumer base is demonstrating greater resilience than previously anticipated. Factors contributing to Hilton Grand Vacations’ robust earnings include the successful integration of the Bluegreen portfolio and the introduction of HGV Max. Consequently, Goldman Sachs has revised its 2025 EBITDA forecast for Hilton Grand Vacations from $1,083 million to $1,126 million, primarily due to higher VPG.
Despite the positive earnings and the increased price target, Goldman Sachs is looking for additional evidence to support the sustainability of the VPG trend and to assess the potential impact of an increase in provisions in the future. The Sell rating reflects a cautious stance, with the firm seeking more data points before becoming more optimistic about the stock’s prospects.
In other recent news, Hilton Grand Vacations reported its first-quarter 2025 earnings, revealing a significant miss in earnings per share (EPS), which came in at $0.09 compared to the forecasted $0.59. The company’s revenue for the quarter was $1.15 billion, falling short of the anticipated $1.25 billion. Despite these misses, the company maintained its full-year adjusted EBITDA guidance, indicating confidence in its strategic initiatives and future growth plans. Mizuho (NYSE:MFG) Securities expressed a positive outlook on Hilton Grand Vacations, raising the stock’s price target from $60.00 to $70.00 and maintaining an Outperform rating. The firm highlighted the company’s effective implementation of an upgrade cycle and the potential to unlock value from its balance sheet. Hilton Grand Vacations experienced a 10% year-over-year increase in contract sales and an 11% rise in revenue, excluding cost reimbursements. Additionally, strategic initiatives like product enhancements and cost synergies are expected to support future performance. The company’s financing business reported revenue of $125 million, contributing to its diversified business model.
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