Choice Hotels vs Travel + Leisure
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KIRA’s take AI analyst
I put Choice Hotels and Travel + Leisure side by side, using each one’s latest annual report. Here is what stands out:
- Travel + Leisure is the larger business, with $4.0B of revenue in fiscal 2025 against $1.6B for Choice Hotels, about 2.5 times as much.
- Travel + Leisure grew revenue faster (4.1%, against 0.8%).
- Choice Hotels kept more of each dollar of sales as operating profit (28.1% operating margin, against 13.8%).
- Travel + Leisure turned more of its sales into free cash flow (13.0% FCF margin, against 10.2%).
- Choice Hotels earned a higher return on the capital invested in it (19.5%, against 8.5%).
- Investors pay more for each dollar of Travel + Leisure’s earnings: a P/E of 17.7x against 15.3x for Choice Hotels.
Who comes out ahead
Of the 8 measures where higher (or lower) is clearly better, how many each company leads.
Choice Hotels
CHH
5/8
5-year growthOperating marginNet marginReturn on capitalNet debt / EBITDA
Travel + Leisure
TNL
3/8
Revenue growthFCF marginShare count change
Side by side
Best in the row
| Latest fiscal year | CHH FY25 | TNL FY25 |
|---|---|---|
| Size | ||
| Market cap | $4.9B | $4.2B |
| Revenue | $1.6B | $4.0B |
| Free cash flow | $164M | $523M |
| Net income | $370M | $230M |
| Growth | ||
| Revenue growth | 0.8% | 4.1% |
| 5-year growth | 15.6% | 13.2% |
| Share count change | −3.1% | −5.4% |
| Profitability | ||
| Gross margin | — | — |
| Operating margin | 28.1% | 13.8% |
| Net margin | 23.2% | 5.7% |
| FCF margin | 10.2% | 13.0% |
| Return on capital | 19.5% | 8.5% |
| Return on equity | — | — |
| Balance sheet | ||
| Net debt | $1.9B | $5.3B |
| Net debt / EBITDA | 3.7x | 7.9x |
| Dividends and buybacks | $192M | $450M |
| Valuation & quality | ||
| P/E | 15.3x | 17.7x |
| Piotroski F-score | 6 | — |
Ten years
Revenue
Operating margin
Free cash flow
Return on capital
Each company's latest fiscal year; fiscal years end in different months. The best value in each row is highlighted where higher (or lower) is clearly better. Not investment advice.