Travel + Leisure Co

Travel+Leisure Co reported second-quarter revenue of $1.06 billion and EBITDA of $269 million, a 9% year-over-year increase, while raising its full-year EBITDA guidance to between $1.065 billion and $1.085 billion. Gross VOI sales rose 6% to $693 million, and earnings per share increased 21% year-over-year. The company returned $253 million to shareholders through dividends and share repurchases in the first half of the year, reducing common shares outstanding by 4%. Acquisitions of Yes& Vacations and Spinnaker Resorts added 23 resorts and over 100,000 owners, and the company expects these deals to be immediately accretive to earnings. The Travel and Membership segment saw a 5% revenue decline and an 11% EBITDA decline, reflecting challenges in the exchange business.

Doster Construction has broken ground on the new Sports Illustrated Resorts destination in Tuscaloosa, Alabama. The company will serve as general contractor for the approximately $150 million development, which is expected to create around 1,100 construction jobs and 100 permanent jobs upon completion. Located along Rice Mine Road near the Black Warrior River, the project will feature two six-story towers with 75 whole-ownership condominiums and 86 vacation ownership units, plus retail space, bars, a game lounge, coffee bar, and rooftop event space. Construction begins this month, with the resort anticipated to open in 2028. The development is led by Travel + Leisure Co. for Sports Illustrated Resorts, which operates under a license from Authentic Brands Group.

Travel + Leisure Co. has completed a $300 million term securitization transaction. The deal involved the issuance of asset-backed notes with an overall weighted average coupon of 5.52% and an advance rate of 98.00%. The notes were issued by Sierra Timeshare 2026-2 Receivables Funding LLC, an indirect subsidiary, and consist of $136 million of Class A Notes at 4.98%, $52 million of Class B Notes at 5.19%, $62 million of Class C Notes at 5.63%, and $50 million of Class D Notes at 7.19%. Chief Financial Officer Erik Hoag stated that the transaction provides efficient access to capital and reflects continued investor demand for the company's receivables platform.

Travel + Leisure has agreed to acquire 23 resorts from Yes& Vacations and Spinnaker Resorts, with management expecting the combined portfolio to contribute about $50 million in annual adjusted EBITDA. The deal comes as the company's share price has eased in the short term, with recent daily and monthly returns declining, while longer-term total shareholder returns remain strongly positive. Based on the most followed narrative, Travel + Leisure's fair value sits at $74.00, just above the last close of $73.27, suggesting the stock is undervalued. The assumed bearish price target is also $74.00, which is up to two standard deviations below the consensus price target of $87.08.

Goldman Sachs upgraded Travel + Leisure Co. to Buy, emphasizing its recurring fee-based income and limited capital intensity. The upgrade comes ahead of the company's second-quarter 2026 earnings release and conference call on July 22, where fee growth and credit quality will be key focal points. Analysts see the asset-light, fee-driven model as a differentiator within the broader travel sector, though the Travel and Membership segment continues to face structural headwinds. Travel + Leisure's narrative projects $4.4 billion in revenue and $868.7 million in earnings by 2029, implying 2.6% annual revenue growth and a $632.7 million increase from current earnings of $236.0 million. The most bullish analysts estimate revenue could reach about $4.6 billion and earnings about $873 million, highlighting a wide range of views on the company's trajectory.

Travel + Leisure stock screens as undervalued despite a 110.4% total return over the past three years. A Discounted Cash Flow analysis estimates an intrinsic value of about $147 per share, implying the stock trades at roughly a 47.8% discount to that estimate. The company's P/E ratio of about 20.3x sits below the Hospitality industry average of roughly 23.8x and a peer group average of about 32.3x, while a fair P/E tailored to its profile comes out at about 39.8x. Recent analyst upgrades cite healthy U.S. travel demand and the company's recurring fee income as support for cash flow assumptions. The key question remains whether the apparent discount offers enough compensation for risks around future travel demand and cash flow durability.