The International Monetary Fund called the global response to COVID-19 the "Great Lockdown" -- and it's a label that should strike fear into the hearts of investors in hotel stocks like Hilton Worldwide (NYSE:HLT).  

In the worst economic downturn since the Great Depression, here in the U.S. the pandemic eliminated perhaps 40 million jobs and caused a 33% plunge in second-quarter GDP. Most relevant to hotel stocks, lockdowns kept folks confined to their homes, unable (or unwilling) to travel -- and thus not needing hotel rooms.

Coronavirus microbes hovering over a city

Image source: Getty Images.

Hilton Worldwide, which despite the name gets 78.5% of its revenue from the U.S., saw sales slide 23% in the first quarter of 2020 (when the coronavirus began to take hold) -- then collapse into an 82% decline in Q2.

But revenue declines are just the start of this story. Hotels need to maintain a certain level of occupancy just to break even and generate cash to service the heavy debts accrued in building them. Hilton owes its creditors $11.7 billion. But as investing maven John Mauldin recently pointed out, "half of hotel rooms in the U.S. are empty as of six days ago. They need at least 80% occupancy to break even."  

Result: Hilton Worldwide stock that cost $111 a share at the beginning of this year closed at just $86 Friday. It's lost 22.5% of its value since the year began. If on Jan. 1 of this year you had invested $10,000 in Hilton stock, today you would have lost $2,250 of that investment.

And all you'd have left is $7,750.

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