INTERCONTINENTAL HOTELS-ADR (IHG) Stock Fundamental Analysis
USA - NYSE:IHG - US45857P8068 - ADR
118.43 USD
-2.19 (-1.82%)
119.06 USD
+0.63 (+0.53%)
IHG gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals 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 decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year IHG was profitable.
In the past year IHG had a positive cash flow from operations.
Of the past 5 years IHG 4 years were profitable.
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 15.19%, IHG belongs to the best of the industry, outperforming 92.48% of the companies in the same industry.
IHG has a better Return On Invested Capital (29.05%) than 96.24% of its industry peers.
IHG had an Average Return On Invested Capital over the past 3 years of 24.68%. This is significantly above the industry average of 15.68%.
The 3 year average ROIC (24.68%) for IHG is below the current ROIC(29.05%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 15.19% | ||
| ROE | N/A | ||
| ROIC | 29.05% |
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 14.65%, IHG belongs to the top of the industry, outperforming 86.47% of the companies in the same industry.
IHG's Profit Margin has improved in the last couple of years.
With an excellent Operating Margin value of 22.34%, IHG belongs to the best of the industry, outperforming 84.21% of the companies in the same industry.
In the last couple of years the Operating Margin of IHG has grown nicely.
Looking at the Gross Margin, with a value of 30.43%, IHG is doing worse than 77.44% of the companies in the same industry.
IHG's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 22.34% | ||
| PM (TTM) | 14.65% | ||
| GM | 30.43% |
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
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so IHG is creating value.
IHG has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, IHG has less shares outstanding
The debt/assets ratio for IHG is higher compared to a year ago.
2.2 Solvency
IHG has an Altman-Z score of 2.33. This is not the best score and indicates that IHG is in the grey zone with still only limited risk for bankruptcy at the moment.
IHG has a Altman-Z score of 2.33. This is in the better half of the industry: IHG outperforms 60.90% of its industry peers.
IHG has a debt to FCF ratio of 6.03. This is a slightly negative value and a sign of low solvency as IHG would need 6.03 years to pay back of all of its debts.
IHG's Debt to FCF ratio of 6.03 is fine compared to the rest of the industry. IHG outperforms 72.18% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 6.03 | ||
| Altman-Z | 2.33 |
ROIC/WACC3.52
WACC8.25%
2.3 Liquidity
A Current Ratio of 0.79 indicates that IHG may have some problems paying its short term obligations.
IHG has a Current ratio of 0.79. This is comparable to the rest of the industry: IHG outperforms 42.11% of its industry peers.
A Quick Ratio of 0.79 indicates that IHG may have some problems paying its short term obligations.
The Quick ratio of IHG (0.79) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.79 | ||
| Quick Ratio | 0.79 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 18.60% over the past year.
The Earnings Per Share has been growing slightly by 7.39% on average over the past years.
Looking at the last year, IHG shows a quite strong growth in Revenue. The Revenue has grown by 8.47% in the last year.
IHG shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 1.25% yearly.
EPS 1Y (TTM)18.6%
EPS 3Y43.24%
EPS 5Y7.39%
EPS Q2Q%18.87%
Revenue 1Y (TTM)8.47%
Revenue growth 3Y19.2%
Revenue growth 5Y1.25%
Sales Q2Q%6.05%
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 15.61% yearly.
The Revenue is expected to grow by 7.54% on average over the next years.
EPS Next Y19.51%
EPS Next 2Y15.65%
EPS Next 3Y14.39%
EPS Next 5Y15.61%
Revenue Next Year5.56%
Revenue Next 2Y5.91%
Revenue Next 3Y5.87%
Revenue Next 5Y7.54%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
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
IHG is valuated rather expensively with a Price/Earnings ratio of 24.37.
IHG's Price/Earnings ratio is a bit cheaper when compared to the industry. IHG is cheaper than 63.16% of the companies in the same industry.
IHG's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.20.
The Price/Forward Earnings ratio is 19.83, which indicates a rather expensive current valuation of IHG.
Based on the Price/Forward Earnings ratio, IHG is valued a bit cheaper than 60.15% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.70. IHG is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.37 | ||
| Fwd PE | 19.83 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, IHG is valued a bit more expensive than 60.15% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of IHG indicates a somewhat cheap valuation: IHG is cheaper than 67.67% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 26.59 | ||
| EV/EBITDA | 17.81 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of IHG may justify a higher PE ratio.
A more expensive valuation may be justified as IHG's earnings are expected to grow with 14.39% in the coming years.
PEG (NY)1.25
PEG (5Y)3.3
EPS Next 2Y15.65%
EPS Next 3Y14.39%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.44%, IHG has a reasonable but not impressive dividend return.
IHG's Dividend Yield is a higher than the industry average which is at 3.93.
Compared to the average S&P500 Dividend Yield of 2.38, IHG is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.44% |
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
35.60% of the earnings are spent on dividend by IHG. This is a low number and sustainable payout ratio.
DP35.6%
EPS Next 2Y15.65%
EPS Next 3Y14.39%
118.43
-2.19 (-1.82%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners69.35%
Inst Owner Change3.31%
Ins Owners0.37%
Ins Owner ChangeN/A
Market Cap18.08B
Analysts52
Price Target127.34 (7.52%)
Short Float %0.92%
Short Ratio7.21
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.44% |
Yearly Dividend1.6
Dividend Growth(5Y)-16.62%
DP35.6%
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)4.52%
PT rev (3m)0.12%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)2.42%
EPS NY rev (3m)0.94%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)-0.79%
Revenue NY rev (3m)-0.67%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.37 | ||
| Fwd PE | 19.83 | ||
| P/S | 3.53 | ||
| P/FCF | 26.59 | ||
| P/OCF | 20.69 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 17.81 |
EPS(TTM)4.86
EY4.1%
EPS(NY)5.97
Fwd EY5.04%
FCF(TTM)4.45
FCFY3.76%
OCF(TTM)5.73
OCFY4.83%
SpS33.54
BVpS-17.32
TBVpS-25
PEG (NY)1.25
PEG (5Y)3.3
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 15.19% | ||
| ROE | N/A | ||
| ROCE | 40.27% | ||
| ROIC | 29.05% | ||
| ROICexc | 37.14% | ||
| ROICexgc | 78.59% | ||
| OM | 22.34% | ||
| PM (TTM) | 14.65% | ||
| GM | 30.43% | ||
| FCFM | 13.28% |
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-Score7
Asset Turnover1.04
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 6.03 | ||
| Debt/EBITDA | 3 | ||
| Cap/Depr | 293.94% | ||
| Cap/Sales | 3.79% | ||
| Interest Coverage | 6.39 | ||
| Cash Conversion | 72.23% | ||
| Profit Quality | 90.67% | ||
| Current Ratio | 0.79 | ||
| Quick Ratio | 0.79 | ||
| Altman-Z | 2.33 |
F-Score7
WACC8.25%
ROIC/WACC3.52
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)18.6%
EPS 3Y43.24%
EPS 5Y7.39%
EPS Q2Q%18.87%
EPS Next Y19.51%
EPS Next 2Y15.65%
EPS Next 3Y14.39%
EPS Next 5Y15.61%
Revenue 1Y (TTM)8.47%
Revenue growth 3Y19.2%
Revenue growth 5Y1.25%
Sales Q2Q%6.05%
Revenue Next Year5.56%
Revenue Next 2Y5.91%
Revenue Next 3Y5.87%
Revenue Next 5Y7.54%
EBIT growth 1Y15.32%
EBIT growth 3Y25.64%
EBIT growth 5Y5.15%
EBIT Next Year18.06%
EBIT Next 3Y11.15%
EBIT Next 5Y11.03%
FCF growth 1Y-0.73%
FCF growth 3Y3.42%
FCF growth 5Y6.39%
OCF growth 1Y11.2%
OCF growth 3Y4.41%
OCF growth 5Y2.09%