Assessing new hotel openings through an event study

Abstract

The main objective of this paper is to analyse the impact that the announcement of the opening of a new hotel has on the performance of its chain. For this evaluation, an event study is carried out on a hotel chain that trades on the Spanish Stock Exchange. The results that the empirical application arrives at are noteworthy as, on average, the reaction to such news releases is highly positive. Additionally, and from a first-approach perspective, several factors seem to exert an influence on the firm´s performance, the most important of these being its geographical location.