Morgan Stanley upgrades outlook for China's hotel industry, H World and Atour receive "Overweight" rating

AASTOCKS
2026.02.09 02:32

Morgan Stanley published a research report, updating its forecasts for Chinese hotel and leisure companies to reflect the bank's latest industry outlook and the relative operational performance of each company. The bank's preferred order is H World (HTHT.US), Atour (ATAT.US), ShouLve Hotel (600258.SH), JinJiang Hotels (600754.SS), and China Youth Travel Service (600138.SH).

As the revenue per available room in Chinese hotels has ended a two-year decline, and the industry's fundamentals have turned supportive, the bank sees a clear shift from a downturn environment to a recovery phase. Morgan Stanley has upgraded its view on the Hong Kong/Mainland leisure and accommodation industry to "Attractive." It has raised its average earnings forecasts for 2026 to 2027 by about 10%. Stocks rated "Overweight" include H World and Atour, both showing the highest earnings characteristics, with expected net profit growth in 2026 significantly improving compared to the past three years. The target price for H World has been raised from $47 to $65; the target price for Atour has been raised from $40 to $45

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