Hilton Worldwide Holdings: The Best Hospitality Stock for Hedge Funds?

In the ever-evolving landscape of hospitality, one company stands out as a beacon of resilience and growth: Hilton Worldwide Holdings Inc. (HLT). With a 552% total return since its 2013 IPO, Hilton has outperformed the S&P 500, making it a strong contender for the best hospitality stock to buy according to hedge funds. But is it truly the best bet? Let's dive into the data and see what the numbers tell us.

Hilton's capital light business model and strong competitive advantages have been key drivers of its success. The company's focus on franchising and managing properties rather than owning them has allowed it to generate revenue without the high capital expenditure associated with property ownership. This model has proven to be a significant advantage in the post-pandemic recovery, as the hotel industry has bounced back with a combination of "revenge travel" and business recovery booming.



Hedge funds' recent trading activities and portfolio adjustments reflect a mixed sentiment towards HLT. According to the data, hedge funds have decreased their holdings in HLT by 2.9 million shares in the last quarter. This reduction suggests a lack of confidence or a shift in strategy among hedge fund managers regarding HLT. For instance, prominent hedge fund managers such as Louis Moore Bacon, Ray Dalio, Richard Driehaus, and John Armitage have sold out their positions in HLT, indicating a significant loss of confidence in the stock. Louis Moore Bacon's Moore Capital Management LP sold out its position, reducing its holdings by 100%. Similarly, Ray Dalio's Bridgewater Associates, LP and Richard Driehaus's Driehaus Capital Management LLC also sold out their positions, reducing their holdings by 100%. John Armitage's Egerton Capital (UK) LLP also sold out its position, reducing its holdings by 100%. These actions collectively point to a very negative hedge fund confidence signal for HLT. However, there are some hedge funds that have increased their holdings or added new positions in HLT. For example, Carolina Wealth Advisors, LLC added to its position, increasing its holdings by 282.06%, and Michael Rockefeller's Woodline Partners LP initiated a new position, adding 100.00% to its portfolio. These actions suggest that some hedge funds still see value in HLT and are willing to invest in it. Overall, the recent trading activities and portfolio adjustments of hedge funds reflect a mixed sentiment towards HLT, with a majority of hedge funds reducing their holdings and a few increasing or initiating new positions.

Despite the mixed sentiment, Hilton's strong financial performance and record growth make it an attractive investment for hedge funds. The company reported its fourth quarter and full year 2024 results, highlighting record levels of growth. Hilton's strong financial performance, including a 552% total return since its 2013 IPO, is a significant factor driving hedge funds' interest. Hilton's capital light business model and strong competitive advantages make it a more attractive investment for hedge funds compared to other hospitality stocks such as Marriott (MAR), Intercontinental Hotels Group (IHG), and Hyatt Hotels (H).

In conclusion, while hedge funds' recent trading activities and portfolio adjustments reflect a mixed sentiment towards HLT, Hilton's strong financial performance, capital light business model, and record growth make it an attractive investment for hedge funds. However, investors should be cautious and consider the mixed sentiment among hedge funds before making an investment decision.