The Top 5 Analyst Questions That Stood Out During Choice Hotels’ Q4 Earnings Call

Choice Hotels Q4 2025: Earnings Overview

In the fourth quarter, Choice Hotels delivered results that surpassed analyst forecasts for both revenue and adjusted earnings per share, even though overall sales remained steady compared to the previous year. Leadership attributed these achievements to the strength of higher-revenue brands, vigorous growth in international markets, and notable progress in the extended stay category. CEO Patrick Pacious highlighted a record number of new extended stay hotel launches in the U.S. and a strategic move to remove underperforming properties, which enhanced both profitability and guest satisfaction.

Wondering if now is the right moment to invest in CHH?

Key Financial Metrics for Q4 2025

• Revenue: $390.2 million, exceeding analyst projections of $370.2 million (unchanged year-over-year, 5.4% above expectations)
• Adjusted EPS: $1.60, topping estimates of $1.54 (3.7% higher)
• Adjusted EBITDA: $140.9 million, closely matching estimates of $140.6 million (36.1% margin)
• Adjusted EPS forecast for FY2026: $7.03 midpoint, 1.4% below analyst consensus
• EBITDA forecast for FY2026: $639.5 million midpoint, ahead of estimates at $633.1 million
• Operating Margin: 26%, a decrease from 30.6% in the same period last year
• RevPAR: $49.82 at quarter end, down 1.4% year-over-year
• Market Cap: $4.90 billion

While management’s prepared remarks are informative, analyst questions during earnings calls often reveal deeper insights and address challenging topics. Here are the questions that stood out to us this quarter:

Top Analyst Questions from Choice Hotels’ Q4 Earnings Call

• Michael Joseph Bellisario (Baird): Asked about plans for key money, capital spending, and joint venture investments in 2026. CFO Scott Oaksmith responded that key money allocations will rise with more hotel openings, but overall development spending should decrease as brands mature.
• Elizabeth Dove (Goldman Sachs): Inquired about strategies to return U.S. room growth to positive levels. CEO Pacious pointed to increased franchise awards in midscale and economy segments, along with higher guest satisfaction, as drivers of growth.
• Elizabeth Dove (Goldman Sachs): Also questioned how factors like tax relief and the World Cup are reflected in RevPAR guidance. Pacious explained that while these are favorable, their precise impact is hard to measure and not fully included in projections.
• Daniel Brian Politzer (JPMorgan): Asked about the expected pattern of RevPAR improvement throughout the year. Pacious and Oaksmith noted that Q1 will face challenges due to hurricane comparisons, but anticipate gradual improvement as broader economic conditions strengthen.
• Meredith Prichard Jensen (HSBC): Queried about conversion activity and whether higher conversion rates are expected. Pacious emphasized that elevated interest rates and limited new construction support conversions, with most new signings coming from independent hotels seeking brand affiliation.

Upcoming Quarter Catalysts

Looking forward, the StockStory team will track several key developments: the pace of net room growth in the U.S., especially from brands focused on conversions; the durability of international expansion and direct franchising profitability; and the impact of the updated Choice Privileges loyalty program on direct bookings and repeat guests. Additional attention will be paid to management’s ability to sustain margin discipline as development spending declines and revenue streams diversify.

Choice Hotels shares are currently priced at $107.48, down from $109.40 before the earnings announcement. Is this a buying opportunity or a signal to sell?

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