Choice Hotels rises after quarterly results boost RevPAR outlook

What happened

Choice Hotels (CHH) rose 6.7% on November 2, 2026, after third-quarter results beat estimates and the company raised its full-year RevPAR outlook. The company reported adjusted EBITDA of approximately $193 million and third-quarter EPS of $2.33, which topped the $2.29 consensus. Choice Hotels said U.S. net rooms growth improved year over year for the third consecutive quarter and that owned hotel sales advanced its asset-light strategy, according to Seeking Alpha and Zacks Investment Research.

How big was the move

The stock closed at $118.61 in a session that was 3.3 times a typical daily move for this stock. Trading volume ran at 2.5 times its 20-day average and the shares opened 2.7% above the previous close. Choice Hotels outperformed its sector: the Consumer Cyclical sector median rose 2.6% while the stock was 4.1 percentage points better than the sector median. The S&P 500 fell 0.5% on the day, and over the last five sessions the stock rose 8.9% while the S&P 500 fell 1.8%.

The technical picture

The stock traded 9.3% above its 20-day moving average, 13.6% above its 50-day moving average and 10.8% above its 200-day moving average. The 50-day average is below the 200-day average, a sign of a weak longer-term trend, even as the stock has spent 13 consecutive trading days above the 200-day average. The Relative Strength Index (14 days) stood at 70, and the shares sit 4.2% below the 52-week high. Over one month the stock rose 15.7% and over one year it rose 28.1%, which is 17.6 percentage points ahead of the S&P 500.

Fundamentals and valuation

For the four quarters through September 30, 2026, Choice Hotels reported revenue of $1.63 billion, which grew 2.1% from a year earlier. Diluted earnings per share for that period were $4.50, although earnings per share fell 44.6% from a year earlier. Gross margin was 38.4% compared with 46.6% a year earlier, and operating margin was 23.0% down from 29.3% a year earlier. The company generated a free-cash-flow margin of 14.5% and reported return on invested capital of 13.3%.

The balance sheet shows net debt of 4.4 times EBITDA, and the company’s share count over one year decreased by 2.3%. Those figures sit alongside a free-cash-flow yield of 4.7% and a price to forward earnings of 16.9 times expected earnings. Price to trailing earnings was 26.4 times trailing earnings, a level higher than 81% of its own readings over the past five years, where the five-year median was 21.5 times earnings.

Earnings and analyst expectations

Choice Hotels reported third-quarter EPS of $2.33 against $2.29 expected, 1.7% above estimates, marking its second consecutive quarter beating estimates. The company’s average surprise over the last four reports was 3.6% below estimates, and its typical two-day reaction after recent reports was rose 0.1%. The next report date listed is November 4, 2026.

Analysts covering the stock number 28, with a consensus rating of Hold and a consensus price target of $112.33, which is 5.3% below the closing price on November 2, 2026. Eleven percent of analysts rated the stock Buy or Strong Buy.

On PromtFinance scores, the stock ranks strongly on Momentum and Stability within its sector, at 74 and 72 respectively, while scores for Value, Growth, Quality and Revisions are weaker, ranging from 5 to 42. Those mixed scores mirror the company’s operating picture: steady cash generation and improving room growth, weighed against compressed margins and a higher-than-normal price to trailing earnings.

What to watch

• Next report: November 4, 2026
• Last report: November 2, 2026: third-quarter EPS $2.33 vs $2.29 expected
• Market value: $5.06 billion
• Price to trailing earnings: 26.4 times trailing earnings
• Net debt: 4.4 times EBITDA