WYNDHAM HOTELS & RESORTS INC (WH) Stock Fundamental Analysis
NYSE:WH - New York Stock Exchange, Inc. - US98311A1051 - Common Stock - Currency: USD
Taking everything into account, WH scores 5 out of 10 in our fundamental rating. WH was compared to 135 industry peers in the Hotels, Restaurants & Leisure industry. WH scores excellent on profitability, but there are concerns on its financial health. WH has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
WH had positive earnings in the past year.
In the past year WH had a positive cash flow from operations.
Of the past 5 years WH 4 years were profitable.
In the past 5 years WH always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of WH (7.86%) is better than 77.78% of its industry peers.
Looking at the Return On Equity, with a value of 57.69%, WH belongs to the top of the industry, outperforming 95.56% of the companies in the same industry.
With a decent Return On Invested Capital value of 11.31%, WH is doing good in the industry, outperforming 76.30% of the companies in the same industry.
WH had an Average Return On Invested Capital over the past 3 years of 10.92%. This is below the industry average of 13.81%.
The 3 year average ROIC (10.92%) for WH is below the current ROIC(11.31%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.86% | ||
| ROE | 57.69% | ||
| ROIC | 11.31% |
ROA(3y)7.54%
ROA(5y)5.1%
ROE(3y)40.03%
ROE(5y)25.76%
ROIC(3y)10.92%
ROIC(5y)9.06%
1.3 Margins
The Profit Margin of WH (23.52%) is better than 97.04% of its industry peers.
WH's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 40.00%, WH belongs to the top of the industry, outperforming 99.26% of the companies in the same industry.
In the last couple of years the Operating Margin of WH has grown nicely.
The Gross Margin of WH (59.58%) is better than 71.85% of its industry peers.
WH's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 40% | ||
| PM (TTM) | 23.52% | ||
| GM | 59.58% |
OM growth 3Y10.88%
OM growth 5Y11.89%
PM growth 3Y9.6%
PM growth 5Y21.83%
GM growth 3Y6.26%
GM growth 5Y7.12%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), WH is creating some value.
The number of shares outstanding for WH has been reduced compared to 1 year ago.
The number of shares outstanding for WH has been reduced compared to 5 years ago.
The debt/assets ratio for WH is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.14 indicates that WH is not a great score, but indicates only limited risk for bankruptcy at the moment.
With a Altman-Z score value of 2.14, WH perfoms like the industry average, outperforming 60.00% of the companies in the same industry.
The Debt to FCF ratio of WH is 11.19, which is on the high side as it means it would take WH, 11.19 years of fcf income to pay off all of its debts.
WH's Debt to FCF ratio of 11.19 is in line compared to the rest of the industry. WH outperforms 57.04% of its industry peers.
A Debt/Equity ratio of 4.29 is on the high side and indicates that WH has dependencies on debt financing.
WH has a worse Debt to Equity ratio (4.29) than 60.74% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.29 | ||
| Debt/FCF | 11.19 | ||
| Altman-Z | 2.14 |
ROIC/WACC1.29
WACC8.76%
2.3 Liquidity
A Current Ratio of 0.96 indicates that WH may have some problems paying its short term obligations.
Looking at the Current ratio, with a value of 0.96, WH is in line with its industry, outperforming 52.59% of the companies in the same industry.
A Quick Ratio of 0.96 indicates that WH may have some problems paying its short term obligations.
WH has a Quick ratio of 0.96. This is comparable to the rest of the industry: WH outperforms 55.56% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.96 | ||
| Quick Ratio | 0.96 |
3. Growth
3.1 Past
WH shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 12.47%, which is quite good.
The Earnings Per Share has been growing slightly by 5.83% on average over the past years.
The Revenue has been growing slightly by 2.16% in the past year.
Measured over the past years, WH shows a decrease in Revenue. The Revenue has been decreasing by -7.27% on average per year.
EPS 1Y (TTM)12.47%
EPS 3Y11.16%
EPS 5Y5.83%
EPS Q2Q%10.26%
Revenue 1Y (TTM)2.16%
Revenue growth 3Y-3.46%
Revenue growth 5Y-7.27%
Sales Q2Q%3.95%
3.2 Future
Based on estimates for the next years, WH will show a quite strong growth in Earnings Per Share. The EPS will grow by 14.22% on average per year.
Based on estimates for the next years, WH will show a small growth in Revenue. The Revenue will grow by 7.37% on average per year.
EPS Next Y11.43%
EPS Next 2Y12.25%
EPS Next 3Y12.75%
EPS Next 5Y14.22%
Revenue Next Year3.77%
Revenue Next 2Y5.15%
Revenue Next 3Y6.01%
Revenue Next 5Y7.37%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 20.59 indicates a rather expensive valuation of WH.
Based on the Price/Earnings ratio, WH is valued a bit cheaper than 70.37% of the companies in the same industry.
When comparing the Price/Earnings ratio of WH to the average of the S&P500 Index (27.30), we can say WH is valued slightly cheaper.
WH is valuated correctly with a Price/Forward Earnings ratio of 16.64.
Based on the Price/Forward Earnings ratio, WH is valued a bit cheaper than 68.89% of the companies in the same industry.
WH's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 21.76.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.59 | ||
| Fwd PE | 16.64 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as WH.
Based on the Price/Free Cash Flow ratio, WH is valued a bit cheaper than the industry average as 62.96% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 31 | ||
| EV/EBITDA | 14.96 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates WH does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of WH may justify a higher PE ratio.
WH's earnings are expected to grow with 12.75% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.8
PEG (5Y)3.53
EPS Next 2Y12.25%
EPS Next 3Y12.75%
5. Dividend
5.1 Amount
WH has a Yearly Dividend Yield of 1.84%.
WH's Dividend Yield is a higher than the industry average which is at 3.53.
WH's Dividend Yield is slightly below the S&P500 average, which is at 2.35.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.84% |
5.2 History
The dividend of WH has a limited annual growth rate of 5.55%.
WH has been paying a dividend for over 5 years, so it has already some track record.
WH has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)5.55%
Div Incr Years4
Div Non Decr Years4
5.3 Sustainability
36.83% of the earnings are spent on dividend by WH. This is a low number and sustainable payout ratio.
The dividend of WH is growing, but earnings are growing more, so the dividend growth is sustainable.
DP36.83%
EPS Next 2Y12.25%
EPS Next 3Y12.75%
91
+1.66 (+1.86%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners96.26%
Inst Owner Change0%
Ins Owners2.23%
Ins Owner Change20.46%
Market Cap7.01B
Analysts86.67
Price Target106.07 (16.56%)
Short Float %4.12%
Short Ratio2.95
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.84% |
Yearly Dividend1.53
Dividend Growth(5Y)5.55%
DP36.83%
Div Incr Years4
Div Non Decr Years4
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)2.2%
Min EPS beat(2)1.91%
Max EPS beat(2)2.49%
EPS beat(4)3
Avg EPS beat(4)2.11%
Min EPS beat(4)-2.03%
Max EPS beat(4)6.05%
EPS beat(8)5
Avg EPS beat(8)1.11%
EPS beat(12)9
Avg EPS beat(12)4.11%
EPS beat(16)13
Avg EPS beat(16)11.26%
Revenue beat(2)0
Avg Revenue beat(2)-3.7%
Min Revenue beat(2)-3.89%
Max Revenue beat(2)-3.51%
Revenue beat(4)0
Avg Revenue beat(4)-4.69%
Min Revenue beat(4)-7.52%
Max Revenue beat(4)-3.51%
Revenue beat(8)0
Avg Revenue beat(8)-3.95%
Revenue beat(12)3
Avg Revenue beat(12)-2.47%
Revenue beat(16)4
Avg Revenue beat(16)-2.07%
PT rev (1m)0.21%
PT rev (3m)-11.17%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-3.35%
EPS NY rev (1m)-0.19%
EPS NY rev (3m)-2.85%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-2.95%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-1.95%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.59 | ||
| Fwd PE | 16.64 | ||
| P/S | 4.93 | ||
| P/FCF | 31 | ||
| P/OCF | 25.67 | ||
| P/B | 12.1 | ||
| P/tB | N/A | ||
| EV/EBITDA | 14.96 |
EPS(TTM)4.42
EY4.86%
EPS(NY)5.47
Fwd EY6.01%
FCF(TTM)2.94
FCFY3.23%
OCF(TTM)3.55
OCFY3.9%
SpS18.44
BVpS7.52
TBVpS-32.34
PEG (NY)1.8
PEG (5Y)3.53
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.86% | ||
| ROE | 57.69% | ||
| ROCE | 14.96% | ||
| ROIC | 11.31% | ||
| ROICexc | 11.45% | ||
| ROICexgc | 63.22% | ||
| OM | 40% | ||
| PM (TTM) | 23.52% | ||
| GM | 59.58% | ||
| FCFM | 15.92% |
ROA(3y)7.54%
ROA(5y)5.1%
ROE(3y)40.03%
ROE(5y)25.76%
ROIC(3y)10.92%
ROIC(5y)9.06%
ROICexc(3y)11.26%
ROICexc(5y)9.44%
ROICexgc(3y)87.36%
ROICexgc(5y)71.71%
ROCE(3y)14.45%
ROCE(5y)11.99%
ROICexcg growth 3Y1.88%
ROICexcg growth 5Y0.36%
ROICexc growth 3Y7.5%
ROICexc growth 5Y5.53%
OM growth 3Y10.88%
OM growth 5Y11.89%
PM growth 3Y9.6%
PM growth 5Y21.83%
GM growth 3Y6.26%
GM growth 5Y7.12%
F-Score6
Asset Turnover0.33
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.29 | ||
| Debt/FCF | 11.19 | ||
| Debt/EBITDA | 3.92 | ||
| Cap/Depr | 71.21% | ||
| Cap/Sales | 3.31% | ||
| Interest Coverage | 4.34 | ||
| Cash Conversion | 43.06% | ||
| Profit Quality | 67.66% | ||
| Current Ratio | 0.96 | ||
| Quick Ratio | 0.96 | ||
| Altman-Z | 2.14 |
F-Score6
WACC8.76%
ROIC/WACC1.29
Cap/Depr(3y)56.12%
Cap/Depr(5y)48.19%
Cap/Sales(3y)2.91%
Cap/Sales(5y)2.73%
Profit Quality(3y)100.7%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)12.47%
EPS 3Y11.16%
EPS 5Y5.83%
EPS Q2Q%10.26%
EPS Next Y11.43%
EPS Next 2Y12.25%
EPS Next 3Y12.75%
EPS Next 5Y14.22%
Revenue 1Y (TTM)2.16%
Revenue growth 3Y-3.46%
Revenue growth 5Y-7.27%
Sales Q2Q%3.95%
Revenue Next Year3.77%
Revenue Next 2Y5.15%
Revenue Next 3Y6.01%
Revenue Next 5Y7.37%
EBIT growth 1Y12.25%
EBIT growth 3Y7.04%
EBIT growth 5Y3.76%
EBIT Next Year36.44%
EBIT Next 3Y16.57%
EBIT Next 5Y13.48%
FCF growth 1Y-29.15%
FCF growth 3Y-14.75%
FCF growth 5Y36.96%
OCF growth 1Y-23.53%
OCF growth 3Y-12.03%
OCF growth 5Y23.73%