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OneSpaWorld Holdings Ltd (OSW)
NASDAQ:OSW
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OneSpaWorld Holdings
(NASDAQ:OSW)
Rating:74Outperform
Price Target:―
Positive Factors
Financial Resilience
OSW noted that revenues and EBITDA contracted just 10% during the Great Financial Crisis, suggesting resilience and potential to outperform in a milder economic downturn.
Market Position
OSW is better positioned than the broader consumer discretionary/leisure travel space due to its strong balance sheet, commission-based cost structure, and captive audience of cruise ship passengers.
Revenue and EBITDA Guidance
Demand trends remain consistent and strong, supporting the belief that revenue and EBITDA guidance for 2025 is somewhat conservative.
Negative Factors
Demand Visibility
OSW has limited visibility into future demand since much of its revenue depends on real-time onboard spending, and pre-bookings have a shorter window than cruise ticket bookings.
Operational Challenges
An anticipated $4.3 million combined headwind from more dry dock days and lapping leap day is expected to cause a sequential deceleration to 4% revenue growth.
OneSpaWorld Holdings (OSW) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.90B
Dividend Yield0.65%
Average Volume (3M)607.98K
Price to Earnings (P/E)29.1
Beta (1Y)1.09
Revenue Growth9.80%
EPS Growth89.42%
CountryUS
Employees5,191
SectorConsumer Cyclical
Sector Strength73
IndustryLeisure
Share Statistics
EPS (TTM)0.22
Shares Outstanding102,697,235
10 Day Avg. Volume506,259
30 Day Avg. Volume607,983
Financial Highlights & Ratios
PEG Ratio-3.39
Price to Book (P/B)3.61
Price to Sales (P/S)0.00
P/FCF Ratio28.22
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$22.00Price Target Upside14.23% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering5
OneSpaWorld Holdings Business Overview & Revenue Model
Company DescriptionOneSpaWorld Holdings (OSW) is a global leader in providing health and wellness services onboard cruise ships and at select destination resorts worldwide. The company operates within the leisure and hospitality sectors, offering a comprehensive range of spa, fitness, and beauty treatments. Their services include massage therapy, skincare, body treatments, and salon services, catering to a diverse clientele seeking relaxation and rejuvenation while traveling.
How the Company Makes MoneyOneSpaWorld Holdings makes money through its extensive network of health and wellness centers located primarily on cruise ships and at destination resorts. The company generates revenue by providing various spa and beauty services to passengers and guests. Key revenue streams include direct sales from spa treatments, fitness classes, and beauty services; retail sales of beauty and wellness products; and partnerships with cruise lines and resort operators. These partnerships are significant, as they often involve revenue-sharing agreements where OneSpaWorld benefits from exclusive operating rights in exchange for sharing a portion of their earnings with their partners. Additionally, the company leverages its brand and expertise to attract a steady flow of clients, capitalizing on the growing trend of wellness tourism.
OneSpaWorld Holdings Earnings Call Summary
Earnings Call Date:Apr 30, 2025
(Q1-2025)
| % Change Since: 9.43%|
Next Earnings Date:Jul 30, 2025
Earnings Call Sentiment Positive
The earnings call presented a strong overall performance with revenue and adjusted EBITDA growth, expansion of medi-spa services, and new partnerships, despite some challenges such as a decline in net income and land-based spa revenue. The company remains optimistic about its future growth and shareholder value strategies.Q1-2025 Updates
Positive Updates
Revenue Growth
Total revenues increased by 4% to $219.6 million, compared to $211.2 million in the first quarter of 2024.
Adjusted EBITDA Increase
Adjusted EBITDA increased by 5% to $26.6 million from $25.3 million in the first quarter of 2024.
Expansion of Medi-Spa Services
New technologies in medi-spa services generated over 20% growth in Q1 compared to last year, with these services now available on 148 ships, up from 142 ships.
New Cruise Line Partnerships
Introduced new health and wellness centers on Norwegian Cruise Lines’ first Prima Plus Class ship and executed a new agreement to operate health and wellness centers on 11 ships for P&O Cruise Lines and Cunard.
Strong Cash Flow and Shareholder Returns
Returned $42 million to shareholders through dividends and share repurchases; approved a new $75 million share repurchase program.
Negative Updates
Net Income Decline
Net income was $15.3 million, down from $21.2 million in the first quarter of 2024, primarily due to a $7.7 million benefit from the change in fair value of warrant liabilities in the prior year.
Decrease in Land-Based Spa Business
There was a $1.5 million decrease in land-based spa business revenue, partially due to the closure of hotels where the company had previously operated.
Nonrecurring Severance Expenses
Included $2.5 million of nonrecurring severance expenses in income from operations.
Company Guidance
During the OneSpaWorld First Quarter 2025 Earnings Call, the company provided detailed guidance, reflecting a strong start to the year. Total revenues increased by 4% to $219.6 million, with income from operations at $16.8 million, despite $2.5 million in nonrecurring severance expenses. Adjusted EBITDA rose by 5% to $26.6 million, even after accounting for $1.1 million in severance costs. The company maintained operations on 199 ships, up from 193 in the previous year, with an average increase in cruise ship personnel. Pre-booking revenue remained strong at 23%, and the company saw significant growth in medi-spa services, with over 20% growth in new technology treatments. The company reaffirmed its annual guidance, expecting high single-digit growth in both revenue and adjusted EBITDA, projecting total fiscal 2025 revenue between $950 million and $970 million, and adjusted EBITDA between $115 million and $125 million. For the second quarter, anticipated revenues range from $235 million to $240 million, with adjusted EBITDA between $28 million and $30 million. The company also highlighted a strong balance sheet, approving a new $75 million share repurchase program, building on the previous $50 million buyback, and emphasizing a commitment to enhance shareholder value.OneSpaWorld Holdings Financial Statement Overview
Summary
OneSpaWorld Holdings has shown significant financial improvements, marked by revenue growth of 12.72% and a positive net profit margin of 8.14% in 2024. The company also demonstrated operational efficiency with improved EBIT and EBITDA margins. The balance sheet strength is evident with no debt and a high equity ratio of 74.28%, while cash flow is robust with a 24.31% growth in free cash flow.Income Statement
OneSpaWorld Holdings has shown significant revenue growth with an impressive revenue growth rate of 12.72% from 2023 to 2024. The gross profit margin improved to 14.80%, and the net profit margin turned positive at 8.14% in 2024, indicating improved profitability. EBIT and EBITDA margins also strengthened, demonstrating enhanced operational efficiency. However, prior years showed periods of losses, which should be considered when evaluating long-term performance.78
Positive
Balance Sheet
The company's balance sheet shows strong equity with an equity ratio of 74.28%. The absence of total debt in 2024 is a significant positive shift from previous years and reduces leverage risk. Return on Equity (ROE) increased to 13.14%, reflecting efficient use of equity to generate profits. However, the stability of equity growth and the ability to maintain low debt levels should be monitored.75
Positive
Cash Flow
OneSpaWorld Holdings has demonstrated strong cash flow improvements with a free cash flow growth rate of 24.31% from 2023 to 2024. The operating cash flow to net income ratio is strong at 1.08, indicating robust cash generation relative to net income. The positive free cash flow to net income ratio of 0.99 further supports the company's liquidity position. Continued positive cash flow trends would enhance financial flexibility.80
Positive
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 903.42M | 895.02M | 794.04M | 546.26M | 144.03M | 120.92M | Gross Profit |
| 134.46M | 132.89M | 90.23M | 83.57M | 8.45M | -18.31M | EBIT |
| 77.92M | 78.06M | 54.17M | 15.14M | -52.06M | -265.00M | EBITDA |
| 102.48M | 107.41M | 42.42M | 37.49M | -32.14M | -246.62M | Net Income Common Stockholders |
| 66.97M | 72.86M | -2.97M | 53.16M | -68.52M | -280.49M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 22.61M | 57.44M | 27.70M | 32.06M | 30.94M | 41.55M | Total Assets |
| 708.72M | 746.42M | 706.14M | 717.43M | 688.87M | 702.28M | Total Debt |
| 0.00 | 112.74M | 170.63M | 227.13M | 230.46M | 229.43M | Net Debt |
| 88.37M | 55.30M | 142.92M | 195.06M | 199.52M | 187.88M | Total Liabilities |
| 178.15M | 191.93M | 272.07M | 351.63M | 394.96M | 276.75M | Stockholders Equity |
| 530.56M | 554.50M | 434.07M | 365.81M | 293.90M | 425.53M |
| Cash Flow | Free Cash Flow | ||||
| 66.72M | 72.06M | 57.96M | 19.94M | -37.97M | -38.68M | Operating Cash Flow |
| 73.95M | 78.80M | 63.38M | 24.76M | -35.10M | -36.55M | Investing Cash Flow |
| -7.23M | -6.74M | -5.42M | -4.83M | -2.87M | -2.13M | Financing Cash Flow |
| -109.52M | -42.21M | -62.66M | -18.72M | 27.47M | 68.55M |
OneSpaWorld Holdings Technical Analysis
Positive
19.26
Price Trends
17.59
Positive
18.69
Positive
18.04
Positive
Market Momentum
0.40
Positive
60.98
Neutral
40.84
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OSW, the sentiment is Positive. The current price of 19.26 is above the 20-day moving average (MA) of 18.64, above the 50-day MA of 17.59, and above the 200-day MA of 18.04, indicating a bullish trend. The MACD of 0.40 indicates Positive momentum. The RSI at 60.98 is Neutral, neither overbought nor oversold. The STOCH value of 40.84 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for OSW.
OneSpaWorld Holdings Risk Analysis
OneSpaWorld Holdings disclosed 31 risk factors in its most recent earnings report. OneSpaWorld Holdings reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 1 New Risks
1.
Artificial Intelligence Presents Challenges that Could Impact Our Business by Posing Security Risks to Confidential or Proprietary Information and Personal Data Q4, 2024
OneSpaWorld Holdings Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $1.90B | 29.14 | 12.80% | 0.65% | 9.80% | 89.42% | |
74 Outperform | $6.32B | 30.06 | 8.24% | ― | 18.58% | 169.49% | |
65 Neutral | $2.52B | 12.21 | -52.57% | ― | -0.92% | 0.80% | |
64 Neutral | $8.87B | 49.98 | -79.88% | ― | 10.32% | 20.44% | |
62 Neutral | $6.84B | 11.23 | 3.09% | 3.95% | 2.66% | -25.23% | |
57 Neutral | $3.02B | ― | 58.47% | ― | -6.35% | 79.04% | |
50 Neutral | $407.53M | ― | 22.27% | ― | -3.17% | -194.72% |
* Consumer Cyclical Sector Average
Performance Comparison
OSW
OneSpaWorld Holdings
19.26
4.28
28.57%
PRKS
United Parks & Resorts
47.50
-2.57
-5.13%
PLNT
Planet Fitness
102.52
40.99
66.62%
PTON
Peloton Interactive
7.57
4.58
153.18%
XPOF
Xponential Fitness
9.15
-0.35
-3.68%
LTH
Life Time Group Holdings
28.80
13.16
84.14%
OneSpaWorld Holdings Corporate Events
Executive/Board Changes
OneSpaWorld Announces CCO Susan Bonner’s Departure
Neutral
Apr 4, 2025
On March 17, 2025, OneSpaWorld Holdings Limited announced the immediate departure of Susan Bonner from her role as Chief Commercial Officer. In light of her departure, the company agreed to provide her with enhanced severance benefits, including twenty-four months of continued base salary payments, contingent upon her compliance with her restrictive covenant obligations.
Executive/Board ChangesBusiness Operations and Strategy
OneSpaWorld Holdings Announces Leadership Changes in 2025
Neutral
Mar 17, 2025
On March 17, 2025, OneSpaWorld Holdings announced leadership changes with Stephen B. Lazarus appointed as President while retaining his roles as Chief Financial Officer and Chief Operating Officer until a new CFO is appointed. Leonard Fluxman will continue as CEO and Executive Chairman, and Susan Bonner will step down as Chief Commercial Officer. These transitions highlight the company’s focus on leadership development and its commitment to maintaining its strong market position and growth trajectory in the health and wellness industry.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.