What happened

Hilton Worldwide (HLT 1.03%) stock underperformed the market by a wide margin last month. Shares fell 30% compared to a 12.5% decline in the S&P 500, according to data provided by S&P Global Market Intelligence.

That move contributed to significant losses so far in 2020, with the stock down nearly 50% as of early April.

Fresh towels on a hotel bed.

Image source: Getty Images.

So what

As a leading hotel operator, Hilton's business is exposed to the COVID-19 containment efforts that have ground the travel industry to a standstill in recent weeks. Investors responded to that threat by avoiding the stock in anticipation of a string of tough earnings reports ahead.

Now what

Hilton has closed many of its properties, furloughed workers, and taken dramatic steps to preserve liquidity since early March, including by pausing dividend payments. The chain is sure to see at least two quarters of plunging sales and profits, given that it is offering full refunds across its properties through late June.

The stock could easily rally once economic conditions start improving, but for now investors are remaining cautious while they wait for concrete signs of stabilization in the hard-hit travel industry.