DB:NH5

Stock Analysis Report

Executive Summary

NH Hotel Group, S.A. operates hotels in Spain, Benelux, Italy, Germany, and the rest of Europe; and Latin America and internationally.

Rewards

PE ratio (21.2x) is below the Hospitality industry average (23.8x)

Earnings are forecast to grow 11.52% per year

Risk Analysis

Unstable dividend track record

Large one-off items impacting financial results

Shareholders have been diluted in the past year



Snowflake Analysis

Mediocre balance sheet second-rate dividend payer.


Similar Companies

Share Price & News

How has NH Hotel Group's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: NH5 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-3.0%

NH5

5.4%

DE Hospitality

1.7%

DE Market


1 Year Return

13.0%

NH5

11.0%

DE Hospitality

15.0%

DE Market

Return vs Industry: NH5 exceeded the German Hospitality industry which returned 11% over the past year.

Return vs Market: NH5 underperformed the German Market which returned 15% over the past year.


Shareholder returns

NH5IndustryMarket
7 Day-3.0%5.4%1.7%
30 Day-1.6%3.4%1.4%
90 Day15.5%-9.6%3.3%
1 Year15.7%13.0%15.8%11.0%18.5%15.0%
3 Year19.5%14.2%-4.5%-17.6%17.1%6.9%
5 Year14.4%9.4%-7.0%-26.6%24.3%7.3%

Price Volatility Vs. Market

How volatile is NH Hotel Group's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is NH Hotel Group undervalued compared to its fair value and its price relative to the market?

21.22x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: NH5 (€5.07) is trading above our estimate of fair value (€1.99)

Significantly Below Fair Value: NH5 is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: NH5 is good value based on its PE Ratio (21.2x) compared to the Hospitality industry average (23.8x).

PE vs Market: NH5 is poor value based on its PE Ratio (21.2x) compared to the German market (21.1x).


Price to Earnings Growth Ratio

PEG Ratio: NH5 is poor value based on its PEG Ratio (1.8x)


Price to Book Ratio

PB vs Industry: NH5 is good value based on its PB Ratio (1.7x) compared to the DE Hospitality industry average (2.3x).


Next Steps

Future Growth

How is NH Hotel Group forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

11.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: NH5's forecast earnings growth (11.5% per year) is above the savings rate (-0.4%).

Earnings vs Market: NH5's earnings (11.5% per year) are forecast to grow slower than the German market (13.2% per year).

High Growth Earnings: NH5's earnings are forecast to grow, but not significantly.

Revenue vs Market: NH5's revenue (3.4% per year) is forecast to grow slower than the German market (5% per year).

High Growth Revenue: NH5's revenue (3.4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: NH5's Return on Equity is forecast to be low in 3 years time (8%).


Next Steps

Past Performance

How has NH Hotel Group performed over the past 5 years?

62.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: NH5 has a large one-off gain of €26.2M impacting its September 30 2019 financial results.

Growing Profit Margin: NH5's current net profit margins (5.4%) are lower than last year (6.7%).


Past Earnings Growth Analysis

Earnings Trend: NH5 has become profitable over the past 5 years, growing earnings by 62.5% per year.

Accelerating Growth: NH5's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: NH5 had negative earnings growth (-14.3%) over the past year, making it difficult to compare to the Hospitality industry average (-36.8%).


Return on Equity

High ROE: NH5's Return on Equity (7.7%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is NH Hotel Group's financial position?


Financial Position Analysis

Short Term Liabilities: NH5's short term assets (€506.6M) do not cover its short term liabilities (€632.4M).

Long Term Liabilities: NH5's short term assets (€506.6M) do not cover its long term liabilities (€2.6B).


Debt to Equity History and Analysis

Debt Level: NH5's debt to equity ratio (35.7%) is considered satisfactory.

Reducing Debt: NH5's debt to equity ratio has reduced from 72.8% to 35.7% over the past 5 years.


Balance Sheet

Inventory Level: NH5 has a high level of physical assets or inventory.

Debt Coverage by Assets: NH5's debt is covered by short term assets (assets are 1.1x debt).


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: NH5 is profitable, therefore cash runway is not a concern.

Forecast Cash Runway: NH5 is profitable, therefore cash runway is not a concern.


Next Steps

Dividend

What is NH Hotel Group's current dividend yield, its reliability and sustainability?

2.94%

Current Dividend Yield


Dividend Yield vs Market

company2.9%marketbottom25%1.3%markettop25%3.6%industryaverage5.1%forecastin3Years3.1%

Current dividend yield vs market & industry

Notable Dividend: NH5's dividend (2.94%) is higher than the bottom 25% of dividend payers in the German market (1.32%).

High Dividend: NH5's dividend (2.94%) is low compared to the top 25% of dividend payers in the German market (3.59%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, NH5 has been paying a dividend for less than 10 years.

Growing Dividend: NH5's dividend payments have increased, but the company has only paid a dividend for 3 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (62.4%), NH5's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: NH5's dividends in 3 years are forecast to be well covered by earnings (49.5% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

4.6yrs

Average management tenure


CEO

Ramón Aragonés Marín (65yo)

3.1yrs

Tenure

€969,000

Compensation

Mr. Ramón Aragonés Marín has been Chief Executive Officer of NH Hotel Group, S.A. since January 25, 2017. Mr. Marín studied hotel management and tourism at the hotel management schools of Madrid and Palma  ...


CEO Compensation Analysis

Compensation vs Market: Ramón's total compensation ($USD1.05M) is about average for companies of similar size in the German market ($USD1.49M).

Compensation vs Earnings: Insufficient data to compare Ramón's compensation with company performance.


Leadership Team

NamePositionTenureCompensationOwnership
Ramón Aragonés Marín
CEO, MD & Executive Director3.1yrs€969.00k0.012% 235.4k
Beatriz Puente Ferreras
CFO, Executive MD of Finance & Administration and Executive Director0.8yrsno data0.0074% 147.1k
Rufino Pérez Fernández
Chief Operations Officer & Global Transformation Leader3.1yrsno datano data
Javier Vega-Penichet
Senior Vice President of Investments & Investor Relations0yrsno datano data
Carlos Ulecia Palacios
General Councel1.1yrsno datano data
Tamara Wegmann
Senior Vice President of Compliance0yrsno datano data
Ida Gutiérrez de Escofet
Senior Vice President of Corporate Affairs & Communications9.4yrsno datano data
Isidoro Martínez de la Escalera Álvarez
Chief Marketing Officer5.3yrsno datano data
Fernando Córdova Moreno
Chief People Officer6yrsno datano data
Roberto Chollet Ibarra
Managing Director0yrsno datano data

4.6yrs

Average Tenure

53yo

Average Age

Experienced Management: NH5's management team is considered experienced (4.6 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Ramón Aragonés Marín
CEO, MD & Executive Director3.1yrs€969.00k0.012% 235.4k
Beatriz Puente Ferreras
CFO, Executive MD of Finance & Administration and Executive Director0.8yrsno data0.0074% 147.1k
William Heinecke
Director1.7yrsno datano data
Fernando Lacadena Azpeitia
Independent Director3.7yrs€96.00kno data
Stephen Chojnacki
Director1.7yrsno datano data
Emmanuel Jude Dillipraj Rajakarier
Director1.7yrsno datano data
Alfredo Fernández Agras
Independent Chairman of the Board3.7yrs€275.00k0.038% 764.9k
José María Cantero de Montes-Jovellar
Independent Director3.7yrs€61.00kno data
Kosin Chantikul
Proprietary Director0.8yrsno datano data

1.7yrs

Average Tenure

51.5yo

Average Age

Experienced Board: NH5's board of directors are not considered experienced ( 1.7 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 13.7%.


Top Shareholders

Company Information

NH Hotel Group, S.A.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: NH Hotel Group, S.A.
  • Ticker: NH5
  • Exchange: DB
  • Founded: 1881
  • Industry: Hotels, Resorts and Cruise Lines
  • Sector: Consumer Services
  • Market Cap: €1.998b
  • Shares outstanding: 391.81m
  • Website: https://www.nh-hotels.com

Number of Employees


Location

  • NH Hotel Group, S.A.
  • calle Santa Engracia 120
  • 7º Planta
  • Madrid
  • Madrid
  • 28003
  • Spain

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
NHHBME (Bolsas y Mercados Espanoles)YesBearer SharesESEURJan 1992
0OHGLSE (London Stock Exchange)YesBearer SharesGBEURJan 1992
NHHE.FOTCPK (Pink Sheets LLC)YesBearer SharesUSUSDJan 1992
NH5DB (Deutsche Boerse AG)YesBearer SharesDEEURJan 1992
NHHEBATS-CHIXE (BATS 'Chi-X Europe')YesBearer SharesGBEURJan 1992

Biography

NH Hotel Group, S.A. operates hotels in Spain, Benelux, Italy, Germany, and the rest of Europe; and Latin America and internationally. As of December 31, 2018, the company operated 350 hotels and 54,374 rooms. It is also involved in the real estate, investment, procurement network, and financing businesses; and provision of catering, management, corporate, call center, and other services. The company was formerly known as NH Hoteles, S.A. and changed its name to NH Hotel Group, S.A. in June 2014. NH Hotel Group, S.A. was founded in 1881 and is headquartered in Madrid, Spain. NH Hotel Group, S.A. is a subsidiary of MHG Continental Holding (Singapore) Pte. Ltd. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/15 21:17
End of Day Share Price2020/02/14 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.