Wyndham Hotels & Resorts (WH) AI Stock Analysis

• Market Cap: $6.38B
• Dividend Yield: 1.94%
• Average Volume (3M): 812.89K
• Price to Earnings (P/E): 19.6
• Beta (1Y): 0.83
• Revenue Growth: 3.65%
• EPS Growth: 38.50%
• Country: US
• Employees: 2,200
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Travel Lodging
• EPS (TTM): 1.33
• Shares Outstanding: 76,356,250
• 10 Day Avg. Volume: 986,499
• 30 Day Avg. Volume: 812,887
• PEG Ratio: N/A
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 1.38
• Enterprise Value/Revenue: 6.08
• Enterprise Value/Gross Profit: 7.76
• Enterprise Value/Ebitda: 13.66
• 1Y Price Target: $101.75
• Price Target Upside: 22.47% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 7

• Rating: 72 Outperform
• Price Target: $95.00 ▲(14.35% Upside)

Wyndham Hotels & Resorts scores well due to strong financial performance and positive earnings call highlights, including growth in global system size and strategic initiatives. However, technical indicators and valuation suggest moderate caution, with high leverage posing potential risks.

Positive Factors

Global System Growth

The consistent global system growth and net room expansion indicate a robust market position and effective expansion strategy, which can drive long-term revenue growth and strengthen brand presence.

Technological Innovations

The launch of new technology platforms enhances guest experience and operational efficiency, positioning Wyndham to better compete in the digital age and improve long-term customer satisfaction and loyalty.

Development Pipeline Growth

The growth in the development pipeline signifies strong future expansion potential, ensuring sustained growth in market share and revenue as new properties come online.

Negative Factors

High Leverage

High leverage can pose financial risks, limiting financial flexibility and increasing vulnerability to economic downturns, potentially impacting long-term financial stability.

RevPAR Decline

The decline in RevPAR suggests challenges in maintaining pricing power and occupancy rates, which could pressure revenue growth and profitability if not addressed.

Challenges in China

Operational challenges in China highlight regional risks and could hinder growth in a key market, affecting overall international expansion efforts and brand reputation.

Wyndham Hotels & Resorts Business Overview & Revenue Model

Company Description

Wyndham Hotels & Resorts, Inc. operates as a hotel franchisor worldwide. It operates through Hotel Franchising and Hotel Management segments. The Hotel Franchising segment licenses its lodging brands and provides related services to third-party hotel owners and others. The Hotel Management segment provides hotel management services for full-service and limited-service hotels. It is also involved in the reward loyalty program business. The company's hotel brand portfolios include Super 8, Days Inn, Travelodge, Microtel, Howard Johnson, La Quinta, Ramada, Baymont, AmericInn, Wingate, Wyndham Alltra, Wyndham Garden, Ramada Encore, Hawthorn, Registry Collection, Trademark Collection, TRYP, Dazzler, Esplendor, Wyndham Grand, Dolce, and Wyndham. As of August 9, 2022, it operated a portfolio of 22 hotel brands with approximately 9,000 hotels with approximately 8,19,000 rooms in approximately 95 countries. The company was incorporated in 2017 and is headquartered in Parsippany, New Jersey.

How the Company Makes Money

Wyndham Hotels & Resorts primarily generates revenue through a franchise model, where it charges franchise fees to hotel owners who operate under its brands. These fees include initial franchise fees, ongoing royalties based on the hotel's revenue, and additional fees for services such as marketing and technology support. The company also earns revenue from its hotel management services, where it operates hotels on behalf of property owners for a fee. Key revenue streams include the franchise and management fees, as well as revenues from the Wyndham Rewards loyalty program, which drives customer retention and repeat bookings. Partnerships with travel agencies, online travel platforms, and corporate clients further enhance earnings by increasing the visibility and booking capabilities of its properties.

Wyndham Hotels & Resorts Financial Statement Overview

Summary

Wyndham Hotels & Resorts demonstrates strong financial performance with high profitability and steady revenue growth. The income statement is robust with high margins and effective cost management. However, the balance sheet reveals significant leverage, posing financial risk, though mitigated by strong ROE and positive cash flows.

Income Statement

Wyndham Hotels & Resorts shows strong profitability with a consistent rise in gross profit margins, reaching 95.3% in TTM. Net profit margin improved to 23.17% TTM, indicating efficient cost management. Revenue growth displayed a positive trend with a 3% increase from the previous year, highlighting stable market demand. EBIT and EBITDA margins are robust at 38.83% and 43.52% respectively, reflecting operational efficiency.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio of 5.39, indicating significant leverage which might pose financial risk. However, the equity ratio stands at 13.27%, suggesting a modest portion of assets are financed by equity. ROE is strong at 58.95%, reflecting effective utilization of equity to generate profits. The company has shown resilience in maintaining equity despite fluctuations in liabilities.

Cash Flow

Cash flows are generally positive with operating cash flow to net income ratio at 1.02, indicating strong cash generation relative to reported earnings. Free cash flow grew by 20.33% from the previous year, reflecting improved financial flexibility. The free cash flow to net income ratio is 0.86, demonstrating a healthy conversion of income to cash flow.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.41B	1.40B	1.50B	1.56B	950.00M
Gross Profit	1.33B	815.00M	830.00M	880.00M	531.00M
EBITDA	593.00M	582.00M	601.00M	524.00M	284.00M
Net Income	289.00M	289.00M	355.00M	244.00M	-132.00M
Balance Sheet
Total Assets	4.22B	4.03B	4.12B	4.27B	4.64B
Cash, Cash Equivalents and Short-Term Investments	103.00M	66.00M	161.00M	171.00M	493.00M
Total Debt	2.47B	2.21B	2.10B	2.08B	2.60B
Total Liabilities	3.57B	3.29B	3.16B	3.18B	3.68B
Stockholders Equity	650.00M	746.00M	962.00M	1.09B	963.00M
Cash Flow
Free Cash Flow	241.00M	339.00M	360.00M	389.00M	34.00M
Operating Cash Flow	290.00M	376.00M	399.00M	426.00M	67.00M
Investing Cash Flow	-65.00M	-66.00M	179.00M	-34.00M	-31.00M
Financing Cash Flow	-175.00M	-402.00M	-584.00M	-713.00M	363.00M

Wyndham Hotels & Resorts Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 83.08
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WH, the sentiment is Negative. The current price of 83.08 is below the 20-day moving average (MA) of 86.06, below the 50-day MA of 86.63, and below the 200-day MA of 90.87, indicating a bearish trend. The MACD of -0.63 indicates Positive momentum. The RSI at 42.08 is Neutral, neither overbought nor oversold. The STOCH value of 16.42 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for WH.

Wyndham Hotels & Resorts Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HTHT	77 Outperform	11.38B	23.80	30.94%	6.80%	4.43%	1.61%
WH	72 Outperform	$6.38B	19.60	56.16%	1.94%	3.65%	38.50%
HLT	70 Outperform	62.66B	40.92	-34.62%	0.23%	6.26%	38.11%
H	66 Neutral	13.52B	33.40	12.13%	0.42%	0.74%	-54.42%
IHG	63 Neutral	17.99B	24.68	-27.16%	1.46%	8.89%	23.20%
CHH	59 Neutral	5.14B	17.05	-1173.06%	1.05%	1.67%	35.34%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%