We assign a fundamental rating of 3 out of 10 to PK. PK was compared to 125 industry peers in the Diversified REITs industry. PK may be in some trouble as it scores bad on both profitability and health. PK does not seem to be growing, but still is valued expensively.

Quickly go to:

1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

PK had negative earnings in the past year.
In the past year PK had a positive cash flow from operations.
In multiple years PK reported negative net income over the last 5 years.
In multiple years PK reported negative operating cash flow during the last 5 years.

1.2 Ratios

The Return On Assets of PK (-0.14%) is worse than 60.80% of its industry peers.
PK has a worse Return On Equity (-0.35%) than 60.80% of its industry peers.
With a Return On Invested Capital value of 1.93%, PK is not doing good in the industry: 66.40% of the companies in the same industry are doing better.
PK had an Average Return On Invested Capital over the past 3 years of 2.67%. This is in line with the industry average of 3.07%.

		Industry Rank	Sector Rank
ROA	-0.14%
ROE	-0.35%
ROIC	1.93%

ROA(3y)1.67%

ROA(5y)-2.66%

ROE(3y)4.02%

ROE(5y)-5.53%

ROIC(3y)2.67%

ROIC(5y)N/A

1.3 Margins

PK's Profit Margin has declined in the last couple of years.
With a Operating Margin value of 8.36%, PK is not doing good in the industry: 77.60% of the companies in the same industry are doing better.
In the last couple of years the Operating Margin of PK has declined.
PK has a Gross Margin of 64.88%. This is comparable to the rest of the industry: PK outperforms 40.80% of its industry peers.
In the last couple of years the Gross Margin of PK has remained more or less at the same level.

		Industry Rank	Sector Rank
OM	8.36%
PM (TTM)	N/A
GM	64.88%

OM growth 3YN/A

OM growth 5Y-4.28%

PM growth 3YN/A

PM growth 5Y-5.48%

GM growth 3Y-0.22%

GM growth 5Y0.08%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so PK is destroying value.
Compared to 1 year ago, PK has less shares outstanding
The number of shares outstanding for PK has been reduced compared to 5 years ago.
Compared to 1 year ago, PK has a worse debt to assets ratio.

2.2 Solvency

Based on the Altman-Z score of 0.47, we must say that PK is in the distress zone and has some risk of bankruptcy.
PK has a Altman-Z score (0.47) which is comparable to the rest of the industry.
PK has a debt to FCF ratio of 37.41. This is a negative value and a sign of low solvency as PK would need 37.41 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 37.41, PK is doing good in the industry, outperforming 73.60% of the companies in the same industry.
A Debt/Equity ratio of 1.35 is on the high side and indicates that PK has dependencies on debt financing.
PK has a Debt to Equity ratio of 1.35. This is comparable to the rest of the industry: PK outperforms 49.60% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	1.35
Debt/FCF	37.41
Altman-Z	0.47

ROIC/WACC0.33

WACC5.88%

2.3 Liquidity

PK has a Current Ratio of 0.53. This is a bad value and indicates that PK is not financially healthy enough and could expect problems in meeting its short term obligations.
The Current ratio of PK (0.53) is worse than 80.00% of its industry peers.
PK has a Quick Ratio of 0.53. This is a bad value and indicates that PK is not financially healthy enough and could expect problems in meeting its short term obligations.
PK's Quick ratio of 0.53 is on the low side compared to the rest of the industry. PK is outperformed by 80.00% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	0.53
Quick Ratio	0.53

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WACC

Debt/Equity

How to determine the health of a company

Altman-Z score

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3. Growth

3.1 Past

PK shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -104.43%.
Measured over the past years, PK shows a decrease in Earnings Per Share. The EPS has been decreasing by -6.46% on average per year.
PK shows a decrease in Revenue. In the last year, the revenue decreased by -3.57%.
The Revenue has been decreasing by -1.79% on average over the past years.

EPS 1Y (TTM)-104.43%

EPS 3YN/A

EPS 5Y-6.46%

EPS Q2Q%-130.77%

Revenue 1Y (TTM)-3.57%

Revenue growth 3Y24.03%

Revenue growth 5Y-1.79%

Sales Q2Q%-6.01%

3.2 Future

PK is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 13.66% yearly.
PK is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.57% yearly.

EPS Next Y-138.75%

EPS Next 2Y-55.22%

EPS Next 3Y-30.27%

EPS Next 5Y13.66%

Revenue Next Year-1.88%

Revenue Next 2Y-0.58%

Revenue Next 3Y0.67%

Revenue Next 5Y3.57%

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.

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4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings Ratio is negative for PK. In the last year negative earnings were reported.
A Price/Forward Earnings ratio of 57.21 indicates a quite expensive valuation of PK.
Compared to the rest of the industry, the Price/Forward Earnings ratio of PK indicates a somewhat cheap valuation: PK is cheaper than 60.80% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of PK to the average of the S&P500 Index (24.32), we can say PK is valued expensively.

		Industry Rank	Sector Rank
PE	N/A
Fwd PE	57.21

4.2 Price Multiples

73.60% of the companies in the same industry are more expensive than PK, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, PK is valued a bit cheaper than the industry average as 79.20% of the companies are valued more expensively.

		Industry Rank	Sector Rank
P/FCF	18.99
EV/EBITDA	12.09

4.3 Compensation for Growth

PK's earnings are expected to decrease with -30.27% in the coming years. This may justify a cheaper valuation.

PEG (NY)N/A

PEG (5Y)N/A

EPS Next 2Y-55.22%

EPS Next 3Y-30.27%

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5. Dividend

5.1 Amount

With a Yearly Dividend Yield of 8.70%, PK is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 6.59, PK pays a better dividend. On top of this PK pays more dividend than 89.60% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 1.83, PK pays a better dividend.

		Industry Rank	Sector Rank
Dividend Yield	8.7%

5.2 History

The dividend of PK has a limited annual growth rate of 2.02%.
PK has been paying a dividend for over 5 years, so it has already some track record.

Dividend Growth(5Y)2.02%

Div Incr Years0

Div Non Decr Years0

5.3 Sustainability

The earnings of PK are negative and hence is the payout ratio. PK will probably not be able to sustain this dividend level.
PK's earnings are growing more than its dividend. This makes the dividend growth sustainable.

DP-2358.33%

EPS Next 2Y-55.22%

EPS Next 3Y-30.27%

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PARK HOTELS & RESORTS INC / PK FAQ

Can you provide the ChartMill fundamental rating for PARK HOTELS & RESORTS INC?

ChartMill assigns a fundamental rating of 3 / 10 to PK.

What is the valuation status for PK stock?

ChartMill assigns a valuation rating of 2 / 10 to PARK HOTELS & RESORTS INC (PK). This can be considered as Overvalued.

How profitable is PARK HOTELS & RESORTS INC (PK) stock?

PARK HOTELS & RESORTS INC (PK) has a profitability rating of 2 / 10.

What is the earnings growth outlook for PARK HOTELS & RESORTS INC?

The Earnings per Share (EPS) of PARK HOTELS & RESORTS INC (PK) is expected to decline by -138.75% in the next year.