“Wyndham Worldwide Corp. (WYN) shares have rallied 18% this year, ahead of the 8% gain posted by the S&P 500 Index and the 12% advance of the consumer-discretionary sector index. The rally reflects outstanding operating momentum, with revenue growing at least 7% in every quarter last year while operating profit margins widened to 19.3% in 2011 from 17.7% in 2010.
“As a result, Wyndham has produced record year- over-year operating cash flow in each of the last four quarters. Buybacks have carved 18% off the share count in the past six quarters. Wyndham operates midrange hotels and vacation timeshares. The improving economy should spur more travel. Profit estimates are marching higher, with the consensus calling for per-share earnings to rise 22% in the March quarter. Wyndham is a Focus List Buy and a Long-Term Buy.”
Richard J. Moroney, CFA, Dow Theory Forecasts, April 16, 2012
