MARRIOTT INTERNATIONAL INC /MD/ (MAR): what the price assumes
In the published model solve dated 2026-Q2, anchored at $351.08, MARRIOTT INTERNATIONAL INC /MD/ (MAR) is priced for +23.1% growth. boothcheck publishes no house fair value, target price, or buy/sell rating; individual model outputs and user-controlled scenarios are analytical inputs, not Boothcheck targets. Narrative composed 2026-07-03.
Generated: 2026-08-30 · Exported: 2026-08-31 · Source: https://boothcheck.com/report/MAR
Headline
| Field | Value |
|---|---|
| Ticker | MAR |
| Company | MARRIOTT INTERNATIONAL INC /MD/ |
| Current price | $351.08/sh |
| Composition | Franchise fees 13% / Base management fees 5% / Incentive management fees 3% / Contract investment amortization -1% / Owned, leased, and other revenue 6% / Cost reimbursement revenue 73% |
What The Price Assumes (Inversion)
The assumption today's price embeds, recovered by inverting the valuation.
| Field | Value |
|---|---|
| Inversion basis | whole-company |
| Operating margin (value-band context) | 9.0% |
| Operating margin today | 15.8% |
| Margin compression (value-band) | -6.8pp |
| Implied growth | 23.1% |
| Multiple paid | 26x operating income |
The operating-margin figure is value-band context at year 12: derived from the framework's value band, a separate calculation — not part of the priced-in solve.
Solve inputs: computed at a 9.1% cost of capital with 4% terminal growth over a 5-year stage.
How unusual the bet is: within-range (limited comparison data)
| Reference | Value |
|---|---|
| vs own history | +0.27σ |
| cohort percentile (of 212 peers) | 77 |
Valuation X-Ray
Every valuation family lands below the price. The price therefore sits beyond what those standard frames encode.
How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.
| Family | Median price/FV | Models | Reads |
|---|---|---|---|
| Asset | — | 0 | — |
| Earnings | 2.74x | 3 | expensive |
| Relative | 1.63x | 2 | expensive |
| Growth | — | 0 | — |
Families that call it expensive: Earnings, Relative
The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 9.3%); the inversion above states its own rate.
Per-Model Detail (n=5)
| Model | Family | FV | Price/FV | Applicable | Methodology |
|---|---|---|---|---|---|
| DCF Perpetual Growth | Growth | $226.24 | 1.55x | no | FCF base $3.1B, growth 5% (input: historical growth), terminal g 4.0%, WACC 9.3%, 5yr projection |
| DCF Exit Multiple | Growth | $315.62 | 1.11x | no | Exit EV/EBITDA: 19.6x / 21.6x / 23.6x (bear / base = today's held flat / bull), 5yr |
| Relative Valuation | Relative | $241.17 | 1.46x | yes | P/E 23.22x (blended: static sector reference 18x + trailing (TTM) 35x), scenarios: 19.6x / 23.2x / 26.9x (bear / base = reference held flat / bull), EV/EBITDA 14.89x |
| Simple DDM | Growth | — | — | no | — |
| Two-Stage DDM | Growth | — | — | no | — |
| Simple Excess Return | Asset | — | — | no | — |
| Two-Stage Excess Return | Asset | — | — | no | — |
| Discounted Future Market Cap | Growth | $265.52 | 1.32x | no | Rev $26.9B, growth 5% (input: historical growth; tapered), Terminal P/S: 2.9x / 3.4x / 3.9x (bear / base = today's held flat / bull, cap 8x) |
| Peter Lynch Fair Value | Relative | $116.04 | 3.03x | no | EPS $9.67, growth 9% (input: historical EPS growth), PEG=3.85 (Overvalued) |
| Margin Trajectory | Growth | — | — | no | — |
| Earnings Power Value | Earnings | $111.13 | 3.16x | no | Normalized EBIT (5y avg op income, one-time charges added back) $3.74B × (1−27%) / WACC 9.3% → EPV (no growth) |
| Residual Income | Asset | — | — | no | — |
| Graham Number | Asset | — | — | no | — |
| EV/EBITDA Relative | Relative | $193.97 | 1.81x | yes | EBITDA $4.25B × sector EV/EBITDA 12.0x |
| FCF Yield | Earnings | $128.24 | 2.74x | yes | FCF $3132.0M / Kₑ 9.3% — zero-growth perpetuity |
| SBC-Adj FCF Yield | Earnings | $117.91 | 2.98x | yes | SBC-adj FCF $2.88B (FCF $3.13B − SBC $0.25B) capitalized at Kₑ |
| Ben Graham Formula | Earnings | $218.03 | 1.61x | yes | EPS $9.67 × (8.5 + 2×9.2%) × (4.4 / 5.3%) |
| ROIC-Justified P/B | Asset | — | — | no | — |
| P/Sales Sector | Relative | $257.93 | 1.36x | no | Revenue $26.90B × sector P/S 2.5x |
| PEG Fair Value | Relative | $133.46 | 2.63x | no | EPS $9.67 × (PEG 1.5 × growth 9.2% (input: historical EPS growth)) → PE 13.8x |
| Earnings Yield | Earnings | $104.54 | 3.36x | no | EPS $9.67 / required return 9.3% (Rf 4.3% + ERP 5.0%) |
| Funds From Operations Multiple | Relative | — | — | no | — |
| Clinical Phase NPV | Growth | — | — | no | — |
| Merton | Asset | — | — | no | — |
| V5 Mechanical | — | — | — | no | — |
Solvency
| Field | Value |
|---|---|
| Net debt | $16.6b |
| Net debt / NOPAT (after-tax) | 5.31x |
| Net debt / operating income (pre-tax) | 3.90x |
| Interest coverage | 5.0x |
| Share count CAGR (buyback) | -5.3% |
| Burning cash | no |
Bullet Takeaways
The market is pricing Marriott as a high-quality fee machine, and the fundamentals largely back it: Q1 2026 adjusted EBITDA rose 15% on RevPAR up 4.2%, net rooms grew 4.5%, and the development pipeline hit a record 618,000 rooms.
The valuation leaves no cushion. At $396.11 (as of June 27, 2026) no standard method reaches the price, and the embedded bet runs about five years out, so the buyer is paying ahead of every conventional frame.
The capital structure is the watch item. Marriott carries about $16.2 billion of net debt and is buying back stock aggressively, with over $4.4 billion of returns planned for 2026, a strategy that lifts per-share numbers but funds itself partly with debt.
Bull Case
Start with what the market is actually paying for, then check it against the numbers. The market prices Marriott not as a hotel owner but as an asset-light fee engine: it collects franchise and management fees on rooms it does not own, so its economics scale with the global hotel footprint while someone else carries the real estate and the capital intensity. The reported revenue line is misleading on this point, because cost-reimbursement revenue is roughly 73% of the total and is essentially a pass-through; the real profit lives in the fee streams. The fundamentals confirm the market's read. Q1 2026 adjusted EBITDA rose 15% to $1.40 billion on worldwide RevPAR growth of 4.2%, ahead of guidance, with adjusted EPS up 17% to $2.72, beating the $2.58 consensus.
The growth engine is the room pipeline, and it is at a record. Net rooms grew 4.5% year over year, the company added roughly 15,900 net rooms in the quarter, and the development pipeline reached over 618,000 rooms, with 43% under construction or pending conversion. Because Marriott earns fees as those rooms open under its brands, the pipeline is a visible, multi-year forward earnings stream that does not require Marriott to fund the buildings. The 10-K describes the diversified fee architecture, including licensed-IP revenue from co-branded credit cards recognized "as the credit cards are used" (FY2025 10-K, accession 0001048286-26-000007), a high-margin annuity layered on top of the lodging fees.
The per-share compounding is the third leg. Marriott is shrinking its share count aggressively, about 5.2% a year, repurchasing 2.1 million shares for $0.7 billion in Q1 alone and planning to return over $4.4 billion to shareholders in 2026. It raised full-year 2026 adjusted EPS guidance to $11.38 to $11.63. A capital-light brand franchisor with a record pipeline, mid-teens EBITDA growth, a loyalty and credit-card flywheel, and relentless buybacks is exactly the business the market is pricing, and Q1 showed the model delivering.
Bear Case
The governance question to confront is how Marriott funds the per-share growth that supports its valuation. The company carries roughly $16.2 billion of net debt against just $454 million of cash, and it is returning over $4.4 billion to shareholders in 2026, having repurchased $0.7 billion of stock in Q1 alone. The 10-K shows the debt machine that partly funds this, detailing new note issuances including "our Series RR Notes and Series SS Notes ($1,960 million) and our Series TT Notes, Series UU Notes, and Series VV Notes ($1,477 million)" (FY2025 10-K, accession 0001048286-26-000007). Borrowing to buy back stock at a price above every valuation method's estimate is a capital-allocation choice that flatters EPS while loading the balance sheet, and it works only as long as the fee streams keep growing and credit stays cheap.
The valuation offers no margin for that bet to go wrong. No valuation family reaches the $396.11 price: the stock is rich on assets, earnings power, peer multiples, and even forward growth, which the priced-in read flags directly as a bet beyond what any standard frame supports, with an implied horizon of about five years. The aggressive buyback is part of why: shrinking the share count roughly 5.2% a year manufactures EPS growth even when underlying fee growth moderates, which can mask deceleration. Net debt at roughly five times operating income, with interest coverage near 5 times, is manageable today but leaves less room if RevPAR softens.
The cyclical exposure underneath the fee model is the structural risk. Lodging demand is economically sensitive, and Marriott's own raised full-year RevPAR guidance of 2.0% to 3.0% is well below the 4.2% Q1 print, an implicit admission that the company expects growth to slow through the year. If travel demand weakens, fee revenue falls, the debt stays fixed, and the buyback that supported the price becomes harder to sustain. The market is paying a price no method supports for a cyclical business whose per-share growth is partly financed, and that combination, full valuation plus debt-funded returns plus cyclical demand, is precisely the setup that punishes investors when the cycle turns.
Valuation
Marriott trades above every conventional valuation frame, and the X-ray is unusually blunt about it. Against the $396.11 price, no family reaches the price: it is rich on assets, on earnings power, on peer multiples, and even on forward growth, so only a single method is applicable and the blended figure does not resolve to a number below the price. The priced-in characterization states it plainly, that the price is a bet beyond what any standard frame supports, with an implied duration of about 5.1 years. This is a quality-premium valuation in its purest form: the market is paying for a fee model it believes compounds durably, and no present-tense method can justify the multiple.
The priced-in math holds a current operating margin of 16% and an implied terminal margin near 9.6%, with the embedded bet running roughly five years. Note the margin optics are distorted by the cost-reimbursement pass-through that makes up about 73% of revenue; on the fee base alone, Marriott's economics are far more profitable than the headline margin suggests, which is part of why the market awards a premium. The valuation does not lean on filing-sourced growth inputs; the franchise and licensed-IP fee structure documented in the 10-K (FY2025 10-K, accession 0001048286-26-000007) is what backs the quality, not the multiple.
The balance sheet is the honest caveat. Net debt of about $16.2 billion sits at roughly five times operating income with interest coverage near 5 times, a leverage profile that is sustainable while EBITDA grows but offers limited cushion. Because of years of debt-funded buybacks, book equity is negative, which is why the asset-based methods do not apply. The honest read is that this is a price paid entirely on franchise quality and durable fee growth, with no support from any standard method. An investor here is underwriting that the record pipeline and loyalty flywheel sustain mid-teens EBITDA growth long enough to justify a price the methods cannot reach, while the company keeps borrowing to shrink the share count.
Catalysts
Q1 2026 results (reported May 2026) beat and prompted a guidance raise. Adjusted EPS of $2.72 rose 17% and topped the $2.58 consensus, total revenue rose 6% to $6.65 billion, worldwide RevPAR grew 4.2% (ahead of guidance, with US and Canada up 4.0% and international up 4.6%), and adjusted EBITDA rose 15% to $1.40 billion. Net rooms grew 4.5%, the company added about 15,900 net rooms, and the development pipeline reached a record of over 618,000 rooms. Management raised full-year 2026 adjusted EPS guidance to $11.38 to $11.63 while setting full-year RevPAR growth at 2.0% to 3.0%, so the trajectory of RevPAR versus that guided slowdown is the key near-term catalyst.
Capital return is the steady catalyst and the central debate. Marriott repurchased 2.1 million shares for $0.7 billion in Q1, plans to return over $4.4 billion in 2026 through dividends and buybacks, and authorized an additional 25 million shares for repurchase. The pace of buybacks against the debt load is the swing factor: more aggressive returns lift EPS but add leverage, and any sign that capital return is moderating would signal management is prioritizing the balance sheet.
Analyst sentiment is moderately positive but close to the price. Across roughly 26 to 29 analysts the rating is Moderate Buy or Overweight with average price targets near $372 to $376, suggesting limited upside from the current level, and Bernstein's target sits lower at $327. Consensus expects full-year EPS near $11.60 with continued net room growth of 4.5% to 5%. The catalysts that would move the stock are RevPAR holding above the guided range, continued record pipeline conversion, and the sustainability of the buyback, while the risk is a cyclical softening in travel demand against a fully-valued, leveraged balance sheet.
Peer Cohorts (Per Segment, With Filing Citations)
Core business (reported)
- HLT (Hilton Worldwide Holdings Inc.)
- FY2025 10-K: …capabilities as a multi-branded manager, franchisor and lessee of hotels with an associated global, system-wide guest loyalty program and commercial platform help us continue to maintain our position as one of the largest and most geographically diverse hospitality companies in the world. Our principal competitors…
- FY2025 10-K: …Because we operate in a highly competitive industry, our revenues or profits could be harmed if we are unable to compete effectively. The segments of the hospitality industry in which we operate are subject to intense competition. Our principal competitors are other operators of luxury, full-service and…
- CHH (CHOICE HOTELS INTERNATIONAL INC /DE)
- FY2025 10-K: …owned hotels against the franchise and management fee expense that is recognized by our owned hotels in Corporate & Other operating income (loss). Our President and Chief Executive Officer, who is our chief operating decision maker ("CODM"), utilizes budgeted and forecasted financial information as well as industry…
- FY2025 10-K: …which consists of its 22 brands and brand extensions and the hotel management operations of 13 hotels (inclusive of four owned hotels). The 22 brands and brand extensions and hotel management operations are aggregated together within this reportable segment because they have similar economic characteristics, types of…
- WH (Wyndham Hotels & Resorts, Inc.)
- FY2025 10-K: …conditions and other factors, including competition, natural disasters and economic downturns, than the Company's results of operations would be, absent such geographic concentrations. Local and regional economic conditions and other factors may differ materially from prevailing conditions in other parts of the…
- FY2025 10-K: …an independent, public company in May 2018 when it was spun-off from Wyndham Worldwide, now known as Travel + Leisure Co. ("Travel + Leisure"). COMPETITION We encounter competition among hotel franchisors and lodging operators. We believe franchisees make decisions based principally upon the perceived value and…
- HGV (Hilton Grand Vacations Inc.)
- FY2025 10-K: …competes with other entities engaged in the leisure and vacation industry, including resorts, hotels, cruises, accommodation alternatives, such as condominium and single-family home rentals, and alternative travel products like travel clubs. We also compete with home and apartment sharing services that operate…
- FY2025 10-K: …financing revenue, net of financing expense, both of which correspond to the applicable line items from our consolidated statements of income. Financing profit margin is calculated as a percentage by dividing financing profit by financing revenue. We consider this to be an important non-GAAP operating measure because…
- TNL (Travel & Leisure Co.)
- FY2025 10-K: …provides property management services at resorts. This segment is wholly comprised of the Vacation Ownership business line. The Travel and Membership segment operates a variety of travel businesses, including vacation exchange brands, travel technology platforms, travel memberships, and direct-to-consumer rentals.…
- FY2025 10-K: …concentrations of credit risk with any individual counterparty or groups of counterparties. With the exception of the financing provided to customers of its vacation ownership businesses, the Company does not normally require collateral or other security to support credit sales. Market Risk The Company is subject to…
- WYNN (WYNN RESORTS LTD)
- FY2025 10-K: …competition, which may increase in the future. General. The casino resort and hotel industry is highly competitive. Increased competition could result in a loss of customers which may negatively affect our cash flows and results of operations. Macau Operations. We hold one of six gaming concessions authorized by the…
- FY2025 10-K: …they are willing to spend; • disruptions caused by, and the impact on regional demand for casino resorts and inbound tourism and the travel and leisure industry more generally from, events outside of our control, including an outbreak of an infectious disease, public incidents of violence, mass shootings, riots,…
- MGM (MGM Resorts International)
- FY2025 10-K: …investments in unconsolidated affiliates and certain other corporate and management operations. Our investments in unconsolidated affiliates are primarily comprised of our ventures, such as BetMGM North America Venture and MGM Osaka. 2 Customers and Competition We operate in highly competitive environments. We…
- FY2025 10-K: …for any attractive new opportunities (which may include acquisitions of existing properties) that do arise. In addition to competition with other hotels, resorts and casinos, we compete with destination travel locations outside of the markets in which we operate. Our failure to compete successfully in our various…
- LVS (LAS VEGAS SANDS CORP)
- FY2025 10-K: …our table games play was conducted on a credit basis for the year ended December 31, 2025. Hotel revenue measurements: Performance indicators used are occupancy rate (a volume indicator), which is the average percentage of available hotel rooms occupied during a period, and average daily room rate ("ADR," a price…
- FY2025 10-K: …property EBITDA as presented by the Company may not be directly comparable to similarly titled measures presented by other companies. 108 Table of Contents LAS VEGAS SANDS CORP. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED) The Company's segment information as of and for the years ended…
Methodology Note
- Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
- Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
- Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
- Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.
Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.