Shares of Travel Plus Leisure Co. (TNL) plunged 7.19% in the pre-market trading session on Thursday, following the company's fourth-quarter 2024 earnings call. The travel and leisure company's stock faced pressure due to concerns over higher interest expenses and portfolio performance.
According to the earnings call transcript, TNL's Chief Financial Officer, Michael Hug, acknowledged that the recent rise in interest rates could potentially lead to higher interest expenses in 2025 and beyond. He stated that while the impact in 2025 is expected to be minor, it could become a headwind in 2026 and subsequent years, given the assumptions about interest rate movements.
Moreover, Hug highlighted concerns regarding the company's loan portfolio performance. While the overall portfolio quality remains strong, with an average FICO score of 744 for 2024, the company witnessed a rise in delinquencies in the first half of the year, leading to an increase in the loan loss provision guidance to 20% for 2025.
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.