Abstract

Wyndham Hotels & Resorts Inc is scheduled to release fourth-quarter results on February 18, 2026 Post Market, and this preview details last quarter’s revenue, margins, and adjusted EPS alongside current-quarter forecasts and key debate points that may drive share performance into and after the print.

Market Forecast

Consensus indicators for the current quarter point to a modest top-line decline and softer earnings: revenue is projected at $337.32 million, implying a year-over-year change of -2.07%, while adjusted EPS is pegged at $0.89, a year-over-year decline of -10.08%. Forecast EBIT stands at $122.87 million, down an estimated -9.04% year over year; margin forecasts were not disclosed in available projections. The main revenue drivers are expected to remain fee streams that scale with system size and activity, with marketing, reservation and booking revenue and royalties and franchise fees together continuing to anchor the model and its cash generation profile. Within the mix, royalties and franchise fees appear the most promising for durable cash flow this quarter given their recurring nature and size, contributing $147.00 million in the previous quarter; year-over-year comparisons by segment were not disclosed.

Last Quarter Review

Wyndham Hotels & Resorts Inc reported revenue of $382.00 million in the previous quarter, delivered a gross profit margin of 65.71%, generated GAAP net income attributable to the company of $105.00 million with a net profit margin of 27.49%, and posted adjusted EPS of $1.46, up 5.04% year over year. A notable highlight was profitability resilience: GAAP net profit increased 20.69% quarter over quarter, and adjusted EPS of $1.46 exceeded the $1.439 consensus proxy by $0.02. The business mix remained weighted to high-visibility fee lines—marketing, reservation and booking produced $149.00 million (39.01% of revenue) and royalties and franchise fees contributed $147.00 million (38.48% of revenue), with remaining revenue from other services and fees; year-over-year segment growth rates were not disclosed.

Current Quarter Outlook (with major analytical insights)

Fee-Based Engine: Royalties and Franchise Fees

Royalties and franchise fees, which totaled $147.00 million last quarter, form the core cash-generating stream for Wyndham Hotels & Resorts Inc this quarter, as they typically correlate with system size, RevPAR trends, and contractual minimums. The EPS estimate of $0.89 and EBIT estimate of $122.87 million suggest modest margin compression versus the prior-year period, which in turn implies that fee streams could be pressured by a softer revenue environment or by higher incentive and support costs to franchisees. That said, the recurring nature of these fees, along with carryover from previously signed deals, often mitigates cyclical volatility within a single quarter. Investors should watch management’s commentary on net room additions and conversion pace, as these directly influence the royalty base and underpin medium-term EPS trajectories. The combination of a projected -2.07% revenue change and a -10.08% year-over-year EPS change indicates deleverage in the income statement this quarter, which could reflect either lower RevPAR in certain geographies or incremental costs, but the fee structure is still positioned to support cash flow stability if unit counts continue to expand.

Marketing, Reservation and Booking: Volume Sensitivity and Operating Leverage

Marketing, reservation and booking revenue contributed $149.00 million last quarter and should remain a swing factor this quarter since it flexes with transaction volumes, channel mix, and loyalty activity. The forecast revenue of $337.32 million implies a sequential downshift from the prior quarter and a -2.07% year-over-year movement; if marketing and reservation revenue tracks this pattern, EBITDA margins may compress as platform expenses and loyalty program costs absorb fixed elements. The gross margin posted last quarter at 65.71% underscores the high-mix contribution of fee-based activities; however, any channel shift toward higher-cost acquisition or increased promotional intensity can temporarily pressure unit economics. Monitoring booking window commentary, cancellation rates, and loyalty redemption trends will be crucial for understanding whether the modest revenue decline translates into proportionally larger pressure on EBIT and EPS. Should the company maintain disciplined spend in marketing while sustaining direct traffic growth, the gap between revenue pressure and EPS could narrow faster in subsequent quarters.

Share-Price Drivers This Quarter: Revenue Quality, Mix, and Forward Signals

The stock is likely to react most to the quality of revenue and the direction of commentary on room growth and RevPAR across key geographies. Current-quarter forecasts imply that revenue will decline year over year by 2.07% while EPS declines by 10.08%, a spread that often reflects either mix shifts or incremental costs. Investor focus should be on any color around the sustainability of conversion-led signings, the cadence of openings and exits, and whether new affiliations are supporting or diluting fee rates in the near term. Management’s read on booking pace and pricing in the economy and midscale tiers will be closely parsed against the EBIT estimate of $122.87 million, as small deviations here can disproportionately move EPS. Commentary on China’s contribution to net room growth will also matter for valuation, since growth in certain markets can be fee-dilutive near term; clarity on how this affects consolidated RevPAR and fee yields can either validate or challenge the projected margin profile implied by the EPS guidance proxies. Finally, capital allocation—dividends and repurchases—can buffer per-share metrics even if operating conditions are choppy; updates here could modulate the earnings multiple the market is willing to pay.

What the Forecasts Imply for Margins and Cash Flow

While explicit gross and net margin projections for the quarter were not provided, the relationship between the revenue forecast of $337.32 million and the EPS forecast of $0.89 indicates margins likely compress versus last year’s comparable period. In the last reported quarter, a 65.71% gross margin and 27.49% net margin reflected robust fee-mix economics; a normal seasonal downtick from peak periods and selective cost investments can explain why EBIT is forecast to decline by -9.04% year over year against a -2.07% revenue comparison. Investors should assess whether any decremental margins implied by results point to transitory promotional costs or to structural fee-rate pressure. Solid free-cash-flow conversion is typically a function of fee-based revenues and capital-light operations, so disclosures on cash collections, loyalty program funding, and working capital will be critical to gauge how far headline EPS maps to cash this quarter. If the company delivers on costs while maintaining pipeline momentum, it can exit the quarter with a setup for an EPS re-acceleration as revenue comps ease.

Segment Focus: Why Royalties and Franchise Fees Still Screen Best

Given last quarter’s $147.00 million in royalties and franchise fees, this line remains the clearest path to stable cash generation into the print. Even with a modeled decline in EPS year over year, fee streams tend to be resilient quarter to quarter, which can help cushion earnings if marketing-driven revenue fluctuates with short-term demand patterns. The emerging debate concerns whether incremental unit growth in certain geographies is near-term dilutive to RevPAR and fee yields; the answer is likely dependent on ramp timing and mix rather than permanent economics. A clean execution on openings, lower-than-expected churn, and stable fee rates would support a more constructive EPS progression than the current -10.08% forecast implies. As a result, qualitative commentary on franchisee health and the pricing environment should be a significant driver of post-report sentiment.

Analyst Opinions

The balance of recent insights is tilted bullish. Within the latest six-month window, there are four Buy reiterations versus one Neutral initiation, giving a clear bullish majority. On the supportive side, Barclays has reiterated Buy ratings multiple times with price targets in the $93.00–$99.00 range, emphasizing the durability of the fee-income model and the earnings power that can accrue as the system expands. J.P. Morgan’s Daniel Politzer also maintained a Buy rating with a $91.00 price target, reflecting confidence that the company’s fee-first structure and capital-light approach can sustain healthy cash conversion and underpin EPS growth as macro and mix pressures normalize. The bullish case into this quarter rests on several core points. First, the fee streams that dominated last quarter’s revenue—marketing, reservation and booking, plus royalties and franchise fees—provide visibility even when top-line trends are modestly negative; this supports the idea that an earnings floor exists despite forecast year-over-year declines in revenue and EPS. Second, the upward surprise on adjusted EPS last quarter, albeit modest at approximately $0.02, indicates management’s capacity to hold the line on costs and execute within guidance ranges; bulls expect similar discipline to offset a portion of revenue softness this quarter. Third, as new units come online and previously signed conversions ramp, fee revenue should strengthen on a multi-quarter view; this underpins Buy-rated analysts’ confidence that current-quarter margin pressure will not define the earnings trajectory for the year. Finally, capital allocation can remain supportive: even if quarterly results are in line with conservative forecasts, a steady dividend and potential buybacks can protect per-share outcomes while the underlying system grows. From a trading perspective, bullish analysts are focused on qualitative updates that can validate the model’s resilience this quarter. If management communicates healthy conversion activity, stable fee rates, and constructive signs in booking trends, the revenue estimate of $337.32 million and EPS estimate of $0.89 could prove conservative, setting up positive estimate revisions. In their view, the spread between a -2.07% revenue forecast and a -10.08% EPS forecast leaves room for operational upside: a small beat on EBIT relative to the $122.87 million marker, coupled with stable below-the-line items, could lift EPS above the $0.89 proxy. Additionally, if commentary on geographies with near-term fee dilution points to improving yields or faster-than-expected ramp, the stock could re-rate as visibility improves, reinforcing the Buy stance prevalent among recent notes.