InterContinental's Demand Improving, Despite China Travel Still Lagging

We expect InterContinental to retain its brand intangible asset (a source of its narrow moat rating) and expand room share in the hotel industry in the next decade. Renovated and newer brands focused on an attractive next-generation traveler position as well as its industry-leading loyalty program will drive this growth. The company currently has a mid-single-digit percentage share of global hotel rooms and 11% share of all industry pipeline rooms. We see its total room growth averaging 3%-4% over the next decade, above the 1.8% supply increase we estimate for the U.S. industry.