Is Resilient Earnings Growth Shifting the Investment Case for Meliá Hotels International (BME:MEL)?

• Meliá Hotels International recently reported its financial results for the third quarter and nine months ended September 30, 2025, posting increases in sales, revenue, and net income compared to the previous year.
• An interesting insight from the results is that the company achieved higher net income over the nine-month period despite ongoing pressures related to operating costs and regional exposure.
• We'll explore how Meliá's ability to deliver steady earnings growth impacts its overall investment narrative moving forward.

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Meliá Hotels International Investment Narrative Recap

To be a shareholder in Meliá Hotels International, you need to believe in its ability to drive steady earnings growth through global tourism demand, premium segment repositioning, and an expanding asset-light hotel pipeline. While the recent results confirm revenue and net income gains, the most important short-term catalyst, resilient travel demand, remains intact. The biggest current risk, regional exposure to the Mediterranean and Spain, isn't materially shifted by this quarter’s news, as growth continues against cost headwinds but without a notable change in geographic concentration.

Among recent announcements, Meliá’s launch of the Global Smart Hotel Showcase with Huawei stands out, aiming to boost guest experience and operational efficiency. This adds context to earnings momentum by showing ongoing investment in technological innovation, which may help the company sustain margin growth and partially offset rising labor and other operating costs.

However, investors should be well aware that despite consistent growth, the company's concentration in Mediterranean markets means any adverse local developments could quickly put pressure on future earnings...

Read the full narrative on Meliá Hotels International (it's free!)

Meliá Hotels International's outlook anticipates €2.2 billion in revenue and €176.0 million in earnings by 2028. This implies annual revenue growth of 2.5% and a modest €3.7 million increase in earnings from the current €172.3 million.

Uncover how Meliá Hotels International's forecasts yield a €9.08 fair value, a 26% upside to its current price.

Exploring Other Perspectives

Four Simply Wall St Community members estimate fair value for Meliá between €6 and €12.84 per share, a wide spread highlighting strong differences in outlook. These views prompt you to consider that, amid ongoing cost pressures, opinions on Meliá’s path to margin stability and geographic diversification may shape your assessment of its potential.

Explore 4 other fair value estimates on Meliá Hotels International - why the stock might be worth as much as 77% more than the current price!

Build Your Own Meliá Hotels International Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Meliá Hotels International research is our analysis highlighting 5 key rewards and 2 important warning signs that could impact your investment decision.
• Our free Meliá Hotels International research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Meliá Hotels International's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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