Shares of Marriott (MAR) are rising after the hotel giant provided an update on the Starwood database security incident, noting that it now believes the number of potentially affected guests is lower than its original estimate.
WHAT'S NEW: Marriott issued an update on the number of guests whose passport numbers and payment card numbers were involved in the Starwood reservations database security incident announced by the company on November 30, 2018. The company said that, after "working closely with its internal and external forensics and analytics investigation team," it determined the the total number of guest records involved is less than the initial estimate. In addition, the number of payment cards and passport numbers involved is a "relatively small percentage" of the overall records involved, Marriott said.
The company now believes that the number of potentially involved guests is lower than the 500M the company had originally expected. Marriott has identified approximately 383M records as the upper limit for the total number of guest records that were involved in the incident, it said. The company noted, however, that this does not necessarily mean that information about 383M guests was involved, as in many instances there seem to be multiple records for the same guest.
WHAT'S NOTABLE: When Marriott first announced the database security incident in late November, it said it believed the breach contained information on up to roughly 500M guests who made a reservation at a Starwood property. For roughly 327M of such guests, the information included some combination of name, mailing address, phone number, email address, passport number, Starwood Preferred Guest account information, date of birth, gender, arrival and departure information, reservation date, and communication preferences, the company said at the time.
Soon after the incident was reported, Jefferies analyst David Kaz maintained a Hold rating and $124 price target on Marriott, saying that he did not expect a meaningful financial impact from the incident in the near-term or long-term. Meanwhile, JPMorgan analyst Joseph Greff said at the time that it was "way too early" to quantify the financial impact of the data breach, and that a comparison of the breach to that of Equifax (EFX) is "much too dire" a view. The analyst maintained an Overweight rating on Marriott at the time.
PRICE ACTION: Shares of Marriott are up 4.5% to $106.19 in morning trading.
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