NYSE:TNL
Travel & Leisure Co.
A premier franchise operator for RV resorts and timeshare clubs driving strong cash generation through high-margin rental revenue streams.
Key Metrics
Investment Thesis
Bull Case
The company boasts robust free cash flow of $640M and a massive gross profit margin, supported by an entrenched franchise model that provides recurring revenue with low incremental capital requirements for new units.
Bear Case
Investors should be wary of the accumulated deficit in shareholders' equity of -$982M and recent sharp declines in net income, which suggest underlying profitability pressures or significant one-time charges not fully explained by core operations.
About Travel & Leisure Co.
Travel + Leisure Co. is a leading franchisor of RV resorts and timeshare clubs operating primarily in North America, serving recreational vehicle owners and vacationers seeking extended-stay holiday rentals.
Analysis
Management Discussion
While revenue grew to $4.02B in 2025, net income dropped significantly to $230M compared to previous years due to a substantial non-operating loss of $216M and increased operating costs, highlighting volatility in earnings despite solid operational scale.
Industry Overview
The leisure and travel industry is recovering with strong demand for outdoor recreation, yet faces headwinds from rising interest rates affecting timeshare financing and potential shifts in consumer discretionary spending patterns.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue | $3.57B | $3.75B | $3.86B | $4.02B |
| Cost of Revenue | $157.0M | $133.0M | $92.0M | $273.0M |
| Gross Profit | $3.41B | $3.62B | $3.77B | $3.75B |
| Operating Expenses | $2.76B | $2.90B | $3.04B | $3.19B |
| Operating Income | $653.0M | $720.0M | $733.0M | $553.0M |
| G&A | $479.0M | $454.0M | $475.0M | $498.0M |
| Stock-Based Comp | $45.0M | $38.0M | $41.0M | $57.0M |
| D&A | $119.0M | $112.0M | $115.0M | $124.0M |
| Amortization | $9.0M | $10.0M | $10.0M | $10.0M |
| Other OpEx | $2.28B | $2.44B | $2.56B | $2.70B |
| Non-Operating Income | $-167.0M | $-235.0M | $-220.0M | $-216.0M |
| Interest Expense | $195.0M | $251.0M | — | — |
| Interest Income | $6.0M | $13.0M | — | — |
| Pre-Tax Income | $486.0M | $485.0M | $513.0M | $337.0M |
| Income Tax | $130.0M | $94.0M | $135.0M | $107.0M |
| Continuing Ops | $356.0M | $391.0M | $378.0M | $230.0M |
| Discontinued Ops | $1.0M | $5.0M | $33.0M | $0 |
| Net Income | $357.0M | $396.0M | $411.0M | $230.0M |
| Minority Interest | $0 | $0 | $0 | $0 |
| Net to Common | $357.0M | $396.0M | $411.0M | $230.0M |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Cash & Equivalents | $550.0M | $282.0M | $167.0M | $253.0M |
| Marketable Securities | $18.0M | $19.0M | $18.0M | $18.0M |
| Inventory | $1.19B | $1.14B | $1.23B | $1.13B |
| PP&E (Net) | $658.0M | $655.0M | $591.0M | $531.0M |
| Intangibles | $207.0M | $199.0M | $209.0M | $201.0M |
| Goodwill | $955.0M | $962.0M | $966.0M | $972.0M |
| Operating Leases | $62.0M | $46.0M | $47.0M | $85.0M |
| Total Assets | $6.76B | $6.74B | $6.74B | $6.76B |
| Total Liabilities | $7.66B | $7.66B | $7.62B | $7.74B |
| Shareholders' Equity | $-904.0M | $-917.0M | $-880.0M | $-982.0M |
| Paid-In Capital | $4.24B | $4.28B | — | — |
| Retained Earnings | $1.81B | $2.07B | $2.33B | $2.41B |
| AOCI | $-79.0M | $-70.0M | $-112.0M | $-66.0M |
| Treasury Stock | $6.89B | $7.20B | — | — |
| Total L&E | $6.76B | $6.74B | $6.74B | $6.76B |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Net Income (CFO) | $357.0M | $396.0M | $411.0M | $230.0M |
| Non-Cash Adjustments | $-226.0M | $-550.0M | $-496.0M | $-297.0M |
| Working Capital Changes | $311.0M | $504.0M | $549.0M | $707.0M |
| Cash from Operations | $442.0M | $350.0M | $464.0M | $640.0M |
| Capital Expenditures | $52.0M | $74.0M | $81.0M | $117.0M |
| Cash from Investing | $-50.0M | $-80.0M | $-124.0M | $-107.0M |
| Share Buybacks | $351.0M | $309.0M | $234.0M | $301.0M |
| Dividends Paid | $135.0M | $136.0M | $142.0M | $149.0M |
| Cash from Financing | $-196.0M | $-500.0M | $-458.0M | $-443.0M |
| FX Effect | $-5.0M | $0 | $-11.0M | $7.0M |
| Net Change in Cash | $191.0M | $-230.0M | $-129.0M | $97.0M |
| Beginning Cash | $497.0M | $688.0M | $458.0M | $329.0M |
| Ending Cash | $688.0M | $458.0M | $329.0M | $426.0M |
Frequently Asked Questions
How does Travel & Leisure Co. make money?
The company's revenue is driven by its franchised RV resort network generating gross profit of $3.75B, alongside significant operating expenses of $3.19B reflecting marketing, maintenance, and management fees paid to franchisees across its extensive portfolio.
What are the main risks for TNL?
Sensitivity to seasonal tourism demand fluctuations, potential regulatory changes in timeshare laws, inflationary pressures on supply chain costs, and the risk of franchisee insolvencies impacting brand reputation.
What is TNL's competitive advantage?
Extensive network of premium locations, high brand loyalty among affluent retirees, and a robust franchising model that leverages third-party capital for expansion while maintaining strong cash flow conversion.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.