Travel + Leisure (TNL): Evaluating Valuation After Upbeat 2025 Outlook and Strong Q3 Earnings

Travel + Leisure (TNL) boosted its outlook for 2025 earnings after posting better-than-expected third-quarter results. This move immediately caught investors’ attention. The Vacation Ownership segment continues to draw strength from rising travel demand, especially across Europe.

See our latest analysis for Travel + Leisure.

Travel + Leisure’s upbeat earnings forecast and consistent delivery have fueled positive sentiment, with the stock climbing over 24% year-to-date on a share price return basis. Over the past five years, total shareholder return has swelled to nearly 93%, which underscores solid long-term momentum amid industry-wide travel demand.

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But with shares already up sharply this year and Travel + Leisure trading at a notable discount to analyst price targets, investors must weigh whether recent gains leave room for more upside or if the market has already factored in future growth.

Most Popular Narrative: 16% Undervalued

Travel + Leisure's most widely followed narrative places fair value significantly above the last close. This gives bulls optimism that the stock's recent rally still leaves further room to run. The narrative’s attractive valuation is driven by a clear roadmap for future growth and efficiency, which could continue to set the company apart.

The expansion into new brands (Accor, Sports Illustrated Resorts, Margaritaville) and international markets, particularly with support from leading global hospitality partners, is expected to broaden Travel + Leisure's customer base and diversify revenue streams. This may position the company for sustained long-term top-line growth.

Read the complete narrative.

Want to see what is powering this bullish view? Behind the valuation is a bold set of revenue, earnings, and margin targets spelling out a growth story that could flip market expectations. The full narrative unpacks the crucial numbers and confidence underpinning Travel + Leisure’s perceived upside. Don’t miss the details that have investors buzzing.

Result: Fair Value of $74.27 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, some risks remain, including the company's heavy reliance on US vacation ownership and the potential disruption from evolving consumer travel habits.

Find out about the key risks to this Travel + Leisure narrative.

Build Your Own Travel + Leisure Narrative

If you see the story differently or enjoy deep diving into the numbers yourself, you can craft your own take in just a few minutes. Do it your way.

A great starting point for your Travel + Leisure research is our analysis highlighting 4 key rewards and 3 important warning signs that could impact your investment decision.

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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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