INTERCONTINENTAL HOTELS-ADR (IHG) Stock Fundamental Analysis
NYSE:IHG - New York Stock Exchange, Inc. - US45857P8068 - ADR - Currency: USD
Overall IHG gets a fundamental rating of 5 out of 10. We evaluated IHG against 133 industry peers in the Hotels, Restaurants & Leisure industry. While IHG belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. IHG has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year IHG was profitable.
IHG had a positive operating cash flow in the past year.
IHG had positive earnings in 4 of the past 5 years.
Each year in the past 5 years IHG had a positive operating cash flow.
1.2 Ratios
With an excellent Return On Assets value of 13.23%, IHG belongs to the best of the industry, outperforming 90.98% of the companies in the same industry.
The Return On Invested Capital of IHG (26.63%) is better than 96.24% of its industry peers.
The Average Return On Invested Capital over the past 3 years for IHG is significantly above the industry average of 13.81%.
The last Return On Invested Capital (26.63%) for IHG is above the 3 year average (24.68%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.23% | ||
| ROE | N/A | ||
| ROIC | 26.63% |
ROA(3y)12.57%
ROA(5y)7.64%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)24.68%
ROIC(5y)17.64%
1.3 Margins
Looking at the Profit Margin, with a value of 12.76%, IHG belongs to the top of the industry, outperforming 81.95% of the companies in the same industry.
In the last couple of years the Profit Margin of IHG has grown nicely.
Looking at the Operating Margin, with a value of 21.15%, IHG belongs to the top of the industry, outperforming 82.71% of the companies in the same industry.
In the last couple of years the Operating Margin of IHG has grown nicely.
The Gross Margin of IHG (29.56%) is worse than 77.44% of its industry peers.
In the last couple of years the Gross Margin of IHG has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 21.15% | ||
| PM (TTM) | 12.76% | ||
| GM | 29.56% |
OM growth 3Y5.4%
OM growth 5Y3.86%
PM growth 3Y11.71%
PM growth 5Y8.92%
GM growth 3Y-1.28%
GM growth 5Y1.91%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), IHG is creating value.
The number of shares outstanding for IHG has been reduced compared to 1 year ago.
IHG has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, IHG has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 2.45 indicates that IHG is not a great score, but indicates only limited risk for bankruptcy at the moment.
IHG has a better Altman-Z score (2.45) than 67.67% of its industry peers.
The Debt to FCF ratio of IHG is 5.71, which is a neutral value as it means it would take IHG, 5.71 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of IHG (5.71) is better than 78.95% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 5.71 | ||
| Altman-Z | 2.45 |
ROIC/WACC3.23
WACC8.25%
2.3 Liquidity
IHG has a Current Ratio of 0.97. This is a bad value and indicates that IHG is not financially healthy enough and could expect problems in meeting its short term obligations.
The Current ratio of IHG (0.97) is comparable to the rest of the industry.
A Quick Ratio of 0.97 indicates that IHG may have some problems paying its short term obligations.
IHG has a Quick ratio (0.97) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.97 | ||
| Quick Ratio | 0.97 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 14.99% over the past year.
Measured over the past 5 years, IHG shows a small growth in Earnings Per Share. The EPS has been growing by 7.39% on average per year.
IHG shows a small growth in Revenue. In the last year, the Revenue has grown by 6.47%.
IHG shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 1.25% yearly.
EPS 1Y (TTM)14.99%
EPS 3Y43.24%
EPS 5Y7.39%
EPS Q2Q%18.32%
Revenue 1Y (TTM)6.47%
Revenue growth 3Y19.2%
Revenue growth 5Y1.25%
Sales Q2Q%6.27%
3.2 Future
IHG is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 14.63% yearly.
IHG is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.87% yearly.
EPS Next Y17.18%
EPS Next 2Y15.15%
EPS Next 3Y14.28%
EPS Next 5Y14.63%
Revenue Next Year6.28%
Revenue Next 2Y6.19%
Revenue Next 3Y6.11%
Revenue Next 5Y7.87%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 26.16, which means the current valuation is very expensive for IHG.
Based on the Price/Earnings ratio, IHG is valued a bit cheaper than 60.15% of the companies in the same industry.
When comparing the Price/Earnings ratio of IHG to the average of the S&P500 Index (27.21), we can say IHG is valued inline with the index average.
Based on the Price/Forward Earnings ratio of 22.32, the valuation of IHG can be described as rather expensive.
IHG's Price/Forward Earnings is on the same level as the industry average.
When comparing the Price/Forward Earnings ratio of IHG to the average of the S&P500 Index (21.70), we can say IHG is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.15 | ||
| Fwd PE | 22.31 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, IHG is valued a bit more expensive than 63.91% of the companies in the same industry.
IHG's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. IHG is cheaper than 66.17% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 28.16 | ||
| EV/EBITDA | 18.77 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
IHG has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as IHG's earnings are expected to grow with 14.28% in the coming years.
PEG (NY)1.52
PEG (5Y)3.54
EPS Next 2Y15.15%
EPS Next 3Y14.28%
5. Dividend
5.1 Amount
IHG has a Yearly Dividend Yield of 1.53%.
IHG's Dividend Yield is a higher than the industry average which is at 3.71.
IHG's Dividend Yield is slightly below the S&P500 average, which is at 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.53% |
5.2 History
The dividend of IHG decreases each year by -16.62%.
IHG has paid a dividend for at least 10 years, which is a reliable track record.
IHG has decreased its dividend in the last 3 years.
Dividend Growth(5Y)-16.62%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
IHG pays out 41.24% of its income as dividend. This is a bit on the high side, but may be sustainable.
DP41.24%
EPS Next 2Y15.15%
EPS Next 3Y14.28%
NYSE:IHG (7/2/2025, 3:39:19 PM)
117.93
+0.61 (+0.52%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners69.35%
Inst Owner Change4.37%
Ins Owners0.37%
Ins Owner ChangeN/A
Market Cap18.19B
Analysts51.67
Price Target129.3 (9.64%)
Short Float %0.89%
Short Ratio5.39
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.53% |
Yearly Dividend1.6
Dividend Growth(5Y)-16.62%
DP41.24%
Div Incr Years2
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)N/A
Avg EPS beat(2)N/A
Min EPS beat(2)N/A
Max EPS beat(2)N/A
EPS beat(4)N/A
Avg EPS beat(4)N/A
Min EPS beat(4)N/A
Max EPS beat(4)N/A
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)N/A
Avg Revenue beat(2)N/A
Min Revenue beat(2)N/A
Max Revenue beat(2)N/A
Revenue beat(4)N/A
Avg Revenue beat(4)N/A
Min Revenue beat(4)N/A
Max Revenue beat(4)N/A
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)2.29%
PT rev (3m)0.04%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)0.09%
EPS NY rev (3m)0.21%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.27%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.15 | ||
| Fwd PE | 22.31 | ||
| P/S | 3.7 | ||
| P/FCF | 28.16 | ||
| P/OCF | 25.13 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 18.77 |
EPS(TTM)4.51
EY3.82%
EPS(NY)5.29
Fwd EY4.48%
FCF(TTM)4.19
FCFY3.55%
OCF(TTM)4.69
OCFY3.98%
SpS31.91
BVpS-14.99
TBVpS-21.74
PEG (NY)1.52
PEG (5Y)3.54
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.23% | ||
| ROE | N/A | ||
| ROCE | 36.91% | ||
| ROIC | 26.63% | ||
| ROICexc | 41.6% | ||
| ROICexgc | 98.42% | ||
| OM | 21.15% | ||
| PM (TTM) | 12.76% | ||
| GM | 29.56% | ||
| FCFM | 13.12% |
ROA(3y)12.57%
ROA(5y)7.64%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)24.68%
ROIC(5y)17.64%
ROICexc(3y)42.58%
ROICexc(5y)30.73%
ROICexgc(3y)167.06%
ROICexgc(5y)116.93%
ROCE(3y)34.5%
ROCE(5y)24.84%
ROICexcg growth 3Y8.62%
ROICexcg growth 5Y17.19%
ROICexc growth 3Y22.74%
ROICexc growth 5Y13.9%
OM growth 3Y5.4%
OM growth 5Y3.86%
PM growth 3Y11.71%
PM growth 5Y8.92%
GM growth 3Y-1.28%
GM growth 5Y1.91%
F-Score5
Asset Turnover1.04
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 5.71 | ||
| Debt/EBITDA | 2.95 | ||
| Cap/Depr | 120% | ||
| Cap/Sales | 1.58% | ||
| Interest Coverage | 6.12 | ||
| Cash Conversion | 65.46% | ||
| Profit Quality | 102.87% | ||
| Current Ratio | 0.97 | ||
| Quick Ratio | 0.97 | ||
| Altman-Z | 2.45 |
F-Score5
WACC8.25%
ROIC/WACC3.23
Cap/Depr(3y)129.32%
Cap/Depr(5y)97.04%
Cap/Sales(3y)1.97%
Cap/Sales(5y)2.17%
Profit Quality(3y)118.96%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)14.99%
EPS 3Y43.24%
EPS 5Y7.39%
EPS Q2Q%18.32%
EPS Next Y17.18%
EPS Next 2Y15.15%
EPS Next 3Y14.28%
EPS Next 5Y14.63%
Revenue 1Y (TTM)6.47%
Revenue growth 3Y19.2%
Revenue growth 5Y1.25%
Sales Q2Q%6.27%
Revenue Next Year6.28%
Revenue Next 2Y6.19%
Revenue Next 3Y6.11%
Revenue Next 5Y7.87%
EBIT growth 1Y1.66%
EBIT growth 3Y25.64%
EBIT growth 5Y5.15%
EBIT Next Year18.06%
EBIT Next 3Y11.15%
EBIT Next 5Y10.26%
FCF growth 1Y-20.35%
FCF growth 3Y3.42%
FCF growth 5Y6.39%
OCF growth 1Y-18.92%
OCF growth 3Y4.41%
OCF growth 5Y2.09%