Diamond Resorts International Inc. (NYSE: DRII) announced the fourth quarter financial results on Wednesday, and stock price jumped up 26.69% to $24.21 on Thursday morning.
According to the financial report, total revenue for the fourth quarter rose 17.8% to $273.6 million. Net income increased 127.4% to $49.7 million. Pre-tax income, excluding non-cash stock based compensation, increased 90.1% to $82.2 million. Adjusted EBITDA increased 34.3% to $106.7 million during the fourth quarter.
David F. Palmer, President and Chief Executive Officer, said, “Even with our record financial performance, we believe there is a significant dislocation between the intrinsic value we have built in this business and the market value of our public equity. For this reason, our Board of Directors is initiating a process to explore and evaluate a wide range of strategic alternatives to unlock value for shareholders. The process will be led by a Committee of Independent Directors, which has retained Centerview Partners, LLC as its financial advisor. As we undertake this process, we will continue our focus on providing exceptional customer service and the execution of our growth initiatives.”
Diamond Resorts International also announced the guidance for 2016. The company outlook capital expenditures to range between $35.0 million and $40.0 million. Moreover, Diamond Resorts International expect ordinary course cash expenditures for the takeover of inventory to range between $60.0 million and $70.0 million, cash tax payments to range between $20.0 million and $30.0 million, and cash interest payments on corporate facilities to be between $30.0 million and $35.0 million.
Zacks Investment Research upgraded shares of Diamond Resorts International from “hold” to “buy” on Friday, and offering $21.00 target price.
According to Zacks, “Diamond Resorts International, Inc. operates in the hospitality and vacation ownership industry. It offers a vacation ownership program whereby members acquire vacation ownership interests in the form of points. The company operates resorts in the United States, Canada, Mexico, the Caribbean, South America, Central America, Europe, Asia, Australia, Africa, and internationally. Diamond Resorts International, Inc. is based in Las Vegas, Nevada.”