WYNDHAM HOTELS & RESORTS INC (WH) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:WH - US98311A1051 - Common Stock
78.22 USD
-1.35 (-1.7%)
78.22 USD
0 (0%)
We assign a fundamental rating of 6 out of 10 to WH. WH was compared to 133 industry peers in the Hotels, Restaurants & Leisure industry. WH has an excellent profitability rating, but there are some minor concerns on its financial health. WH has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
- In the past year WH was profitable.
- WH had a positive operating cash flow in the past year.
- Of the past 5 years WH 4 years were profitable.
- Each year in the past 5 years WH had a positive operating cash flow.
1.2 Ratios
- Looking at the Return On Assets, with a value of 7.78%, WH is in the better half of the industry, outperforming 77.44% of the companies in the same industry.
- WH's Return On Equity of 57.98% is amongst the best of the industry. WH outperforms 91.73% of its industry peers.
- WH has a Return On Invested Capital of 11.47%. This is in the better half of the industry: WH outperforms 76.69% of its industry peers.
- WH had an Average Return On Invested Capital over the past 3 years of 10.92%. This is in line with the industry average of 10.34%.
- The last Return On Invested Capital (11.47%) for WH is above the 3 year average (10.92%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.78% | ||
| ROE | 57.98% | ||
| ROIC | 11.47% |
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
- Looking at the Profit Margin, with a value of 23.54%, WH belongs to the top of the industry, outperforming 95.49% of the companies in the same industry.
- WH's Profit Margin has improved in the last couple of years.
- WH has a Operating Margin of 41.30%. This is amongst the best in the industry. WH outperforms 99.25% of its industry peers.
- In the last couple of years the Operating Margin of WH has grown nicely.
- WH has a Gross Margin of 61.00%. This is in the better half of the industry: WH outperforms 74.44% of its industry peers.
- In the last couple of years the Gross Margin of WH has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 41.3% | ||
| PM (TTM) | 23.54% | ||
| GM | 61% |
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.
- WH has less shares outstanding than it did 5 years ago.
- WH has a worse debt/assets ratio than last year.
2.2 Solvency
- An Altman-Z score of 2.00 indicates that WH is not a great score, but indicates only limited risk for bankruptcy at the moment.
- WH has a Altman-Z score (2.00) which is in line with its industry peers.
- The Debt to FCF ratio of WH is 8.94, which is on the high side as it means it would take WH, 8.94 years of fcf income to pay off all of its debts.
- The Debt to FCF ratio of WH (8.94) is better than 65.41% of its industry peers.
- A Debt/Equity ratio of 4.43 is on the high side and indicates that WH has dependencies on debt financing.
- WH has a Debt to Equity ratio (4.43) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.43 | ||
| Debt/FCF | 8.94 | ||
| Altman-Z | 2 |
ROIC/WACC1.46
WACC7.88%
2.3 Liquidity
- A Current Ratio of 1.16 indicates that WH should not have too much problems paying its short term obligations.
- With a decent Current ratio value of 1.16, WH is doing good in the industry, outperforming 61.65% of the companies in the same industry.
- WH has a Quick Ratio of 1.16. This is a normal value and indicates that WH is financially healthy and should not expect problems in meeting its short term obligations.
- WH has a Quick ratio of 1.16. This is in the better half of the industry: WH outperforms 64.66% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.16 | ||
| Quick Ratio | 1.16 |
3. Growth
3.1 Past
- WH shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 11.40%, which is quite good.
- The Earnings Per Share has been growing slightly by 5.83% on average over the past years.
- Looking at the last year, WH shows a small growth in Revenue. The Revenue has grown by 3.38% in the last year.
- The Revenue has been decreasing by -7.27% on average over the past years.
EPS 1Y (TTM)11.4%
EPS 3Y11.16%
EPS 5Y5.83%
EPS Q2Q%5.04%
Revenue 1Y (TTM)3.38%
Revenue growth 3Y-3.46%
Revenue growth 5Y-7.27%
Sales Q2Q%-3.05%
3.2 Future
- WH is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 12.79% yearly.
- The Revenue is expected to grow by 5.73% on average over the next years.
EPS Next Y7.89%
EPS Next 2Y9.47%
EPS Next 3Y10.53%
EPS Next 5Y12.79%
Revenue Next Year1.37%
Revenue Next 2Y3.61%
Revenue Next 3Y4.4%
Revenue Next 5Y5.73%
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
- The Price/Earnings ratio is 16.68, which indicates a correct valuation of WH.
- 75.19% of the companies in the same industry are more expensive than WH, based on the Price/Earnings ratio.
- The average S&P500 Price/Earnings ratio is at 27.32. WH is valued slightly cheaper when compared to this.
- WH is valuated correctly with a Price/Forward Earnings ratio of 15.04.
- Based on the Price/Forward Earnings ratio, WH is valued a bit cheaper than 75.19% of the companies in the same industry.
- The average S&P500 Price/Forward Earnings ratio is at 24.32. WH is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.68 | ||
| Fwd PE | 15.04 |
4.2 Price Multiples
- The rest of the industry has a similar Enterprise Value to EBITDA ratio as WH.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of WH indicates a somewhat cheap valuation: WH is cheaper than 72.18% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 20.1 | ||
| EV/EBITDA | 12.91 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
- WH has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)2.11
PEG (5Y)2.86
EPS Next 2Y9.47%
EPS Next 3Y10.53%
5. Dividend
5.1 Amount
- WH has a Yearly Dividend Yield of 2.04%.
- Compared to an average industry Dividend Yield of 1.19, WH pays a better dividend. On top of this WH pays more dividend than 81.20% of the companies listed in the same industry.
- WH's Dividend Yield is comparable with the S&P500 average which is at 1.83.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.04% |
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
- WH pays out 37.28% of its income as dividend. This is a sustainable payout ratio.
- WH's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP37.28%
EPS Next 2Y9.47%
EPS Next 3Y10.53%
WYNDHAM HOTELS & RESORTS INC / WH FAQ
Can you provide the ChartMill fundamental rating for WYNDHAM HOTELS & RESORTS INC?
ChartMill assigns a fundamental rating of 6 / 10 to WH.
Can you provide the valuation status for WYNDHAM HOTELS & RESORTS INC?
ChartMill assigns a valuation rating of 5 / 10 to WYNDHAM HOTELS & RESORTS INC (WH). This can be considered as Fairly Valued.
Can you provide the profitability details for WYNDHAM HOTELS & RESORTS INC?
WYNDHAM HOTELS & RESORTS INC (WH) has a profitability rating of 8 / 10.
Can you provide the PE and PB ratios for WH stock?
The Price/Earnings (PE) ratio for WYNDHAM HOTELS & RESORTS INC (WH) is 16.68 and the Price/Book (PB) ratio is 10.14.
Is the dividend of WYNDHAM HOTELS & RESORTS INC sustainable?
The dividend rating of WYNDHAM HOTELS & RESORTS INC (WH) is 6 / 10 and the dividend payout ratio is 37.28%.