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InterContinental Hotels Group

LSE:IHG
Snowflake Description

Mediocre balance sheet with acceptable track record.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
IHG
LSE
£9B
Market Cap
  1. Home
  2. GB
  3. Consumer Services
Company description

InterContinental Hotels Group PLC owns, manages, franchises, and leases hotels in the Americas, Europe, Asia, the Middle East, Africa, and Greater China. The last earnings update was 80 days ago. More info.


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IHG Share Price and Events
7 Day Returns
4.4%
LSE:IHG
3.2%
GB Hospitality
1.3%
GB Market
1 Year Returns
0.1%
LSE:IHG
-7.7%
GB Hospitality
-5%
GB Market
IHG Shareholder Return
  7 Day 30 Day 90 Day 1 Year 3 Year 5 Year
InterContinental Hotels Group (IHG) 4.4% 2.6% 9.4% 0.1% 79.8% 59.1%
GB Hospitality 3.2% 0.6% -1.6% -7.7% 11.1% 30.9%
GB Market 1.3% -1.6% 1.9% -5% 15.8% 2.5%
1 Year Return vs Industry and Market
  • IHG outperformed the Hospitality industry which returned -7.7% over the past year.
  • IHG outperformed the Market in United Kingdom of Great Britain and Northern Ireland which returned -5% over the past year.
Price Volatility
Industry
5yr Volatility vs Market

Value

 Is InterContinental Hotels Group undervalued based on future cash flows and its price relative to the stock market?

Value is all about what a company is worth versus what price it is available for. If you went into a grocery store and all the bananas were on sale at half price, they could be considered undervalued.
INTRINSIC VALUE BASED ON FUTURE CASH FLOWS
Here we compare the current share price of InterContinental Hotels Group to its discounted cash flow analysis.value.

The discounted cash flow value is simply looking at what the company is worth today, based on estimates of how much money it is expected to make in the future.
Raw Data

Below are the data sources, inputs and calculation used to determine the intrinsic value for InterContinental Hotels Group.

LSE:IHG Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model 2 Stage Free Cash Flow to Equity
Levered Free Cash Flow Average of 16 Analyst Estimates (S&P Global) See below
Discount Rate (Cost of Equity) See below 8.2%
Perpetual Growth Rate 10-Year GB Government Bond Rate 1.2%

An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.

Calculation of Discount Rate/ Cost of Equity for LSE:IHG
Data Point Calculation/ Source Result
Risk-Free Rate 10-Year GB Govt Bond Rate 1.2%
Equity Risk Premium S&P Global 6.7%
Hospitality Unlevered Beta Simply Wall St/ S&P Global 0.94
Re-levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 0.937 (1 + (1- 19%) (19.31%))
1.056
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm)
1.06
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 1.23% + (1.056 * 6.65%)
8.25%

Discounted Cash Flow Calculation for LSE:IHG using 2 Stage Free Cash Flow to Equity Model

The calculations below outline how an intrinsic value for InterContinental Hotels Group is arrived at by discounting future cash flows to their present value using the 2 stage method. We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.

LSE:IHG DCF 1st Stage: Next 10 year cash flow forecast
Levered FCF (USD, Millions) Source Present Value
Discounted (@ 8.25%)
2019 484.44 Analyst x6 447.52
2020 594.19 Analyst x7 507.09
2021 644.81 Analyst x3 508.35
2022 857.00 Analyst x1 624.16
2023 933.00 Analyst x1 627.73
2024 991.93 Est @ 6.32% 616.53
2025 1,039.44 Est @ 4.79% 596.83
2026 1,078.11 Est @ 3.72% 571.86
2027 1,110.16 Est @ 2.97% 543.99
2028 1,137.35 Est @ 2.45% 514.85
Present value of next 10 years cash flows $5,558.90
LSE:IHG DCF 2nd Stage: Terminal Value
Calculation Result
Terminal Value = FCF2028 × (1 + g) ÷ (Discount Rate – g)
= $1,137.35 × (1 + 1.23%) ÷ (8.25% – 1.23%)
$16,396.97
Present Value of Terminal Value = Terminal Value ÷ (1 + r)10
= $16,396.97 ÷ (1 + 8.25%)10
$7,422.46
LSE:IHG Total Equity Value
Calculation Result
Total Equity Value = Present value of next 10 years cash flows + Terminal Value
= $5,558.90 + $7,422.46
$12,981.36
Equity Value per Share
(USD)
= Total value / Shares Outstanding
= $12,981.36 / 180.69
$71.84
LSE:IHG Discount to Share Price
Calculation Result
Exchange Rate USD/GBP
(Reporting currency to currency of LSE:IHG)
0.785
Value per Share
(GBP)
= Value per Share in USD x Exchange Rate (USD/GBP)
= $71.84 x 0.785
£56.42
Value per share (GBP) From above. £56.42
Current discount Discount to share price of £50.63
= -1 x (£50.63 - £56.42) / £56.42
10.3%

Learn more about our DCF calculations in Simply Wall St’s analysis model .

Current Discount
Amount off the current price InterContinental Hotels Group is available for.
Intrinsic value
10%
Share price is £50.63 vs Future cash flow value of £56.42
Current Discount Checks
For InterContinental Hotels Group to be considered undervalued it must be available for at least 20% below the current price. Less than 40% is even better.
  • InterContinental Hotels Group's share price is below the future cash flow value, but not at a moderate discount (< 20%).
  • InterContinental Hotels Group's share price is below the future cash flow value, but not at a substantial discount (< 40%).
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing when they are out of season, or how much your home is worth.

The amount the stock market is willing to pay for InterContinental Hotels Group's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are InterContinental Hotels Group's earnings available for a low price, and how does this compare to other companies in the same industry?
Raw Data
LSE:IHG PE (Price to Earnings) Ratio Data Sources
Data Point Source Value
Earnings Per Share * Company Filings (2018-12-31) in USD $1.94
LSE:IHG Share Price ** LSE (2019-05-17) in GBP £50.63
LSE:IHG Share Price converted to USD reporting currency Exchange rate (GBP/ USD) 1.273 $64.47
United Kingdom of Great Britain and Northern Ireland Hospitality Industry PE Ratio Median Figure of 34 Publicly-Listed Hospitality Companies 17.95x
United Kingdom of Great Britain and Northern Ireland Market PE Ratio Median Figure of 788 Publicly-Listed Companies 16.24x

* Trailing twelve months (TTM) annual GAAP earnings per share excluding extraordinary items.

** Primary Listing of InterContinental Hotels Group.

LSE:IHG PE (Price to Earnings) Ratio Calculation
Calculation Outcome
PE Ratio

= LSE:IHG Share Price ÷ EPS (both in USD)

= 64.47 ÷ 1.94

33.15x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • InterContinental Hotels Group is overvalued based on earnings compared to the GB Hospitality industry average.
  • InterContinental Hotels Group is overvalued based on earnings compared to the United Kingdom of Great Britain and Northern Ireland market.
Price based on expected Growth
Does InterContinental Hotels Group's expected growth come at a high price?
Raw Data
LSE:IHG PEG (Price to Earnings to Growth) Ratio Data Sources
Data Point Source Value
PE Ratio See PE Ratio Section 33.15x
Net Income Annual Growth Rate See Future Growth Section.
Line of Best Fit* through Consensus Estimate Earnings of 16 Analysts
16.7%per year
United Kingdom of Great Britain and Northern Ireland Hospitality Industry PEG Ratio Median Figure of 28 Publicly-Listed Hospitality Companies 2.06x
United Kingdom of Great Britain and Northern Ireland Market PEG Ratio Median Figure of 574 Publicly-Listed Companies 1.5x

*Line of best fit is calculated by linear regression .

LSE:IHG PEG (Price to Earnings to Growth) Ratio Calculation
Calculation Outcome
PEG Ratio

= PE Ratio ÷ Net Income Annual Growth Rate

= 33.15x ÷ 16.7%

1.99x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • InterContinental Hotels Group is poor value based on expected growth next year.
Price based on value of assets
What value do investors place on InterContinental Hotels Group's assets?
Raw Data
LSE:IHG PB (Price to Book) Ratio Data Sources
Data Point Source Value
Book Value per Share Company Filings (2018-12-31) in USD $-6.00
LSE:IHG Share Price * LSE (2019-05-17) in GBP £50.63
LSE:IHG Share Price converted to USD reporting currency Exchange rate (GBP/ USD) 1.273 $64.47
United Kingdom of Great Britain and Northern Ireland Hospitality Industry PB Ratio Median Figure of 54 Publicly-Listed Hospitality Companies 1.39x
United Kingdom of Great Britain and Northern Ireland Market PB Ratio Median Figure of 1,368 Publicly-Listed Companies 1.51x
LSE:IHG PB (Price to Book) Ratio Calculation
Calculation Outcome
PB Ratio

= LSE:IHG Share Price ÷ Book Value per Share (both in USD)

= 64.47 ÷ -6.00

-10.74x

* Primary Listing of InterContinental Hotels Group.

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • InterContinental Hotels Group has negative assets, we can't compare the value of its assets to the GB Hospitality industry average.
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Value checks
We assess InterContinental Hotels Group's value by looking at:
  1. Is the discounted cash flow value less than 20%, or 40% of the share price? (2 checks) ( Click here or on bar chart for details of DCF calculation. )
  2. Is the PE ratio less than the market average, and/ or less than the Hospitality industry average (and greater than 0)? (2 checks)
  3. Is the PEG ratio within a reasonable range (0 to 1)? (1 check)
  4. Is the PB ratio less than the Hospitality industry average (and greater than 0)? (1 check)
  5. InterContinental Hotels Group has a total score of 0/6, see the detailed checks below.

    Note: We use GAAP Earnings per Share in all our calculations including PE and PEG Ratio.

    Full details on the Value part of the Simply Wall St company analysis model.

Future Performance

 How is InterContinental Hotels Group expected to perform in the next 1 to 3 years based on estimates from 16 analysts?

The future performance of a company is measured in the same way as past performance, by looking at estimated growth and how much profit it is expected to make.

Future estimates come from professional analysts. Just like forecasting the weather, they don’t always get it right!
Annual Growth Rate
16.7%
Expected annual growth in earnings.
Earnings growth vs Low Risk Savings
Is InterContinental Hotels Group expected to grow at an attractive rate?
  • InterContinental Hotels Group's earnings growth is expected to exceed the low risk savings rate of 1.2%.
Growth vs Market Checks
  • InterContinental Hotels Group's earnings growth is expected to exceed the United Kingdom of Great Britain and Northern Ireland market average.
  • InterContinental Hotels Group's revenues are expected to decrease over the next 1-3 years, this is below the United Kingdom of Great Britain and Northern Ireland market average.
Annual Growth Rates Comparison
Raw Data
LSE:IHG Future Growth Rates Data Sources
Data Point Source Value (per year)
LSE:IHG Future Earnings Growth Rate Line of Best Fit* through Consensus Estimate Earnings of 16 Analysts 16.7%
LSE:IHG Future Revenue Growth Rate Line of Best Fit* through Consensus Estimate Revenue of 16 Analysts -5.1%
United Kingdom of Great Britain and Northern Ireland Hospitality Industry Earnings Growth Rate Market Cap Weighted Average 12.2%
United Kingdom of Great Britain and Northern Ireland Hospitality Industry Revenue Growth Rate Market Cap Weighted Average 5.8%
United Kingdom of Great Britain and Northern Ireland Market Earnings Growth Rate Market Cap Weighted Average 10.8%
United Kingdom of Great Britain and Northern Ireland Market Revenue Growth Rate Market Cap Weighted Average 4.9%

*Line of best fit is calculated by linear regression .

Industry and Market average data is calculated daily.

Learn more about our growth rate calculations in Simply Wall St’s analysis model.

Analysts growth expectations
Raw Data
LSE:IHG Analysts Growth Expectations Data Sources
Data Point Source Value
Past Financials Company Filings (4 months ago) See Below
Future Estimates Average of up to 16 Analyst Estimates (S&P Global) See Below
All numbers in USD Millions and using Trailing twelve months (TTM) annual period rather than quarterly.
LSE:IHG Future Estimates Data
Date (Data in USD Millions) Revenue Cash Flow Net Income * Avg. No. Analysts
2023-12-31 2,467 951 837 2
2022-12-31 2,349 885 778 2
2021-12-31 2,282 773 692 5
2020-12-31 2,142 717 621 10
2019-12-31 2,047 641 519 9
LSE:IHG Past Financials Data
Date (Data in USD Millions) Revenue Cash Flow Net Income *
2018-12-31 3,166 666 351
2018-09-30 3,113 651 439
2018-06-30 1,872 693 578
2018-03-31 1,828 664 585
2017-12-31 2,972 577 540
2017-09-30 3,791 545 543
2017-06-30 2,307 597 462
2017-03-31 2,011 675 438
2016-12-31 2,866 710 456
2016-09-30 1,721 768 735
2016-06-30 1,726 783 1,055
2016-03-31 1,765 706 1,139

*GAAP earnings excluding extraordinary items.

Super high growth metrics
High Growth Checks
  • InterContinental Hotels Group's earnings are expected to grow by 16.7% yearly, however this is not considered high growth (20% yearly).
  • InterContinental Hotels Group's revenue is expected to decrease over the next 1-3 years, this is not considered high growth.
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can be gauged below. We look back 3 years and see if they were any good at predicting what actually occurred. We also show the highest and lowest estimates looking forward to see if there is a wide range.
Raw Data
LSE:IHG Past and Future Earnings per Share
Data Point Source Value
Past Financials Company Filings (4 months ago) See Below
Future Estimates Average of up to 16 Analyst Estimates (S&P Global) See Below

All data from InterContinental Hotels Group Company Filings, last reported 4 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

LSE:IHG Future Estimates Data
Date (Data in USD Millions) EPS * EPS High Estimate EPS Low Estimate Avg. No. Analysts
2023-12-31 4.58 4.58 4.58 1.00
2022-12-31 4.25 4.25 4.25 1.00
2021-12-31 3.79 4.01 3.25 7.00
2020-12-31 3.46 3.73 2.99 10.00
2019-12-31 2.82 3.12 2.40 8.00
LSE:IHG Past Financials Data
Date (Data in USD Millions) EPS *
2018-12-31 1.94
2018-09-30 2.43
2018-06-30 3.20
2018-03-31 3.22
2017-12-31 2.95
2017-09-30 2.97
2017-06-30 2.54
2017-03-31 2.34
2016-12-31 2.36
2016-09-30 3.81
2016-06-30 5.47
2016-03-31 6.14

*GAAP earnings excluding extraordinary items.

Performance in 3 years
In the same way as past performance we look at the future estimated return (profit) compared to the available funds. We do this looking forward 3 years.
  • Unable to establish if InterContinental Hotels Group will efficiently use shareholders’ funds in the future without estimates of Return on Equity.
X
Future performance checks
We assess InterContinental Hotels Group's future performance by looking at:
  1. Is the annual earnings growth rate expected to beat the low risk savings rate, plus a premium to keep pace with inflation?
  2. Is the annual earnings growth rate expected to beat the average growth rate in earnings of the United Kingdom of Great Britain and Northern Ireland market? (1 check)
  3. Is the annual revenue growth rate expected to beat the average growth rate in revenue of the United Kingdom of Great Britain and Northern Ireland market? (1 check)
  4. Is the annual earnings growth rate expected to be above 20%? (1 check)
  5. Is the annual revenue growth rate expected to be above 20%? (1 check)
  6. Is the Return on Equity in 3 years expected to be over 20%? (1 check)
Some of the above checks will fail if the company is expected to be loss making in the relevant year.
InterContinental Hotels Group has a total score of 2/6, see the detailed checks below.

Note 1: We use GAAP Net Income Excluding Exceptional Items for our Earnings in all our calculations.

Full details on the Future part of the Simply Wall St company analysis model.

Past Performance

  How has InterContinental Hotels Group performed over the past 5 years?

The past performance of a company can be measured by how much growth it has experienced and how much profit it makes relative to the funds and assets it has available.
Past earnings growth
Below we compare InterContinental Hotels Group's growth in the last year to its industry (Hospitality).
Past Earnings growth analysis
We also check if the company has grown in the past 5 years, and whether it has maintained that growth in the year.
  • InterContinental Hotels Group's year on year earnings growth rate has been positive over the past 5 years, however the most recent earnings are below average.
  • InterContinental Hotels Group's 1-year earnings growth is negative, it can't be compared to the 5-year average.
  • InterContinental Hotels Group's 1-year earnings growth is negative, it can't be compared to the GB Hospitality industry average.
Earnings and Revenue History
InterContinental Hotels Group's revenue and profit over the past 5 years is shown below, any years where they have experienced a loss will show up in red.
Raw Data

All data from InterContinental Hotels Group Company Filings, last reported 4 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

LSE:IHG Past Revenue, Cash Flow and Net Income Data
Date (Data in USD Millions) Revenue Net Income * G+A Expenses R&D Expenses
2018-12-31 3,166.00 351.00 344.00
2018-09-30 3,113.00 438.50 337.50
2018-06-30 1,872.00 578.00 322.00
2018-03-31 1,828.00 585.00 325.00
2017-12-31 2,972.00 540.00 337.00
2017-09-30 3,790.50 543.00 336.00
2017-06-30 2,307.00 462.00 323.00
2017-03-31 2,011.00 438.00 331.00
2016-12-31 2,866.00 456.00 345.00
2016-09-30 1,720.50 734.50 361.50
2016-06-30 1,726.00 1,055.00 384.00
2016-03-31 1,764.50 1,138.50 389.50
2015-12-31 1,803.00 1,222.00 395.00
2015-09-30 1,834.00 871.00 392.50
2015-06-30 1,865.00 520.00 390.00
2015-03-31 1,861.50 455.50 386.00
2014-12-31 1,858.00 391.00 382.00
2014-09-30 1,866.50 330.50 377.00
2014-06-30 1,875.00 270.00 372.00
2014-03-31 1,889.00 321.00 373.00
2013-12-31 1,903.00 372.00 374.00
2013-09-30 1,903.50 448.00 375.00
2013-06-30 1,893.00 606.00 376.00
2013-03-31 1,894.00 553.00 376.00
2012-12-31 1,835.00 537.00 372.00
2012-09-30 1,802.00 584.00 363.00
2012-06-30 1,796.00 588.00 359.00

*GAAP earnings excluding extraordinary items.

Performance last year
We want to ensure a company is making the most of what it has available. This is done by comparing the return (profit) to a company's available funds, assets and capital.
  • It is difficult to establish if InterContinental Hotels Group has efficiently used shareholders’ funds last year (Return on Equity greater than 20%) due to its liabilities exceeding its assets.
  • InterContinental Hotels Group used its assets more efficiently than the GB Hospitality industry average last year based on Return on Assets.
  • InterContinental Hotels Group has improved its use of capital last year versus 3 years ago (Return on Capital Employed).
X
Past performance checks
We assess InterContinental Hotels Group's performance over the past 5 years by checking for:
  1. Has earnings increased in past 5 years? (1 check)
  2. Has the earnings growth in the last year exceeded that of the Hospitality industry? (1 check)
  3. Is the recent earnings growth over the last year higher than the average annual growth over the past 5 years? (1 check)
  4. Is the Return on Equity (ROE) higher than 20%? (1 check)
  5. Is the Return on Assets (ROA) above industry average? (1 check)
  6. Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent earnings report. Some checks require at least 3 or 5 years worth of data.
InterContinental Hotels Group has a total score of 3/6, see the detailed checks below.

Note: We use GAAP Net Income excluding extraordinary items in all our calculations.

Full details on the Past part of the Simply Wall St company analysis model.

Health

 How is InterContinental Hotels Group's financial health and their level of debt?

A company's financial position is much like your own financial position, it includes everything you own (assets) and owe (liabilities).

The boxes below represent the relative size of what makes up InterContinental Hotels Group's finances.

The net worth of a company is the difference between its assets and liabilities.
Net Worth
  • InterContinental Hotels Group is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
  • InterContinental Hotels Group's long term commitments exceed its cash and other short term assets.
Balance sheet
This treemap shows a more detailed breakdown of InterContinental Hotels Group's finances. If any of them are yellow this indicates they may be out of proportion and red means they relate to one of the checks below.
Assets
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
  • Low level of unsold assets.
  • InterContinental Hotels Group has negative shareholder equity (liabilities exceed assets) therefore debt is not covered by short term assets.
Historical Debt
Nearly all companies have debt. Debt in itself isn’t bad, however if the debt is too high, or the company can’t afford to pay the interest on its debts this may have impacts in the future.

The graphic below shows equity (available funds) and debt, we ideally want to see the red area (debt) decreasing.

If there is any debt we look at the companies capability to repay it, and whether the level has increased over the past 5 years.
Raw Data

All data from InterContinental Hotels Group Company Filings, last reported 4 months ago.

LSE:IHG Past Debt and Equity Data
Date (Data in USD Millions) Total Equity Total Debt Cash & Short Term Investments
2018-12-31 -1,077.00 2,249.00 705.00
2018-09-30 -1,077.00 2,249.00 705.00
2018-06-30 -1,162.00 2,035.00 233.00
2018-03-31 -1,162.00 2,035.00 233.00
2017-12-31 -1,301.00 2,019.00 184.00
2017-09-30 -1,301.00 2,019.00 184.00
2017-06-30 -1,097.00 2,222.00 181.00
2017-03-31 -1,097.00 2,222.00 181.00
2016-12-31 -1,146.00 1,712.00 226.00
2016-09-30 -759.00 1,712.00 226.00
2016-06-30 -1,032.00 2,034.00 215.00
2016-03-31 -1,032.00 2,034.00 215.00
2015-12-31 319.00 1,666.00 1,137.00
2015-09-30 319.00 1,666.00 1,137.00
2015-06-30 -495.00 1,915.00 205.00
2015-03-31 -495.00 1,915.00 205.00
2014-12-31 -717.00 1,695.00 167.00
2014-09-30 -717.00 1,695.00 167.00
2014-06-30 -89.00 1,346.00 356.00
2014-03-31 -89.00 1,346.00 356.00
2013-12-31 -74.00 1,399.00 260.00
2013-09-30 -74.00 1,399.00 260.00
2013-06-30 416.00 1,222.00 396.00
2013-03-31 416.00 1,222.00 396.00
2012-12-31 317.00 1,450.00 393.00
2012-09-30 877.00 631.00 175.00
2012-06-30 708.00 609.00 75.00
  • InterContinental Hotels Group has negative shareholder equity (liabilities exceed assets), this is a more serious situation compared with a high debt level.
  • Irrelevant to check if InterContinental Hotels Group's debt level has increased considering it has negative shareholder equity.
  • Debt is well covered by operating cash flow (29.6%, greater than 20% of total debt).
  • Interest payments on debt are well covered by earnings (EBIT is 10.6x coverage).
X
Financial health checks
We assess InterContinental Hotels Group's financial health by checking for:
  1. Are short term assets greater than short term liabilities? (1 check)
  2. Are short term assets greater than long term liabilities? (1 check)
  3. Has the debt to equity ratio increased in the past 5 years? (1 check)
  4. Is the debt to equity ratio over 40%? (1 check)
  5. Is the debt covered by operating cash flow? (1 check)
  6. Are earnings greater than 5x the interest on debt (if company pays interest at all)? (1 check)
  7. InterContinental Hotels Group has a total score of 3/6, see the detailed checks below.
For companies that are loss making and have been so on average in the past we replace the last 2 checks with:
  1. Does cash and short term investments cover stable operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)
  2. Does cash and short term investments cover growing operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)


Full details on the Health part of the Simply Wall St company analysis model.

Dividends

 What is InterContinental Hotels Group's current dividend yield, its reliability and sustainability?

Dividends are regular cash payments to you from the company, similar to a bank paying you interest on a savings account.
Annual Dividend Income
Dividend payments
1.87%
Current annual income from InterContinental Hotels Group dividends. Estimated to be 2.24% next year.
If you bought £2,000 of InterContinental Hotels Group shares you are expected to receive £37 in your first year as a dividend.
Dividend Amount
Here we look how much dividend is being paid, if any. Is it above what you can get in a savings account? It is up there with the best dividend paying companies?
  • InterContinental Hotels Group's pays a lower dividend yield than the bottom 25% of dividend payers in United Kingdom of Great Britain and Northern Ireland (1.99%).
  • InterContinental Hotels Group's dividend is below the markets top 25% of dividend payers in United Kingdom of Great Britain and Northern Ireland (5.21%).
Annualized Historical and Future Dividends
It is important to see if the dividend for a company is stable, and not wildly increasing/decreasing each year. This graph shows you the historical rate to count toward your assessment of the stock.

We also check to see if the dividend has increased in the past 10 years.
Raw Data
LSE:IHG Annualized Past and Future Dividends
Data Point Source Value
Past Annualized Dividend Yield S&P Global Market Data See Below
Past Dividends per Share Company Filings/ Annualized Dividend Payments See Below
Future Dividends per Share Estimates Average of up to 16 Analyst Estimates (S&P Global) See Below
United Kingdom of Great Britain and Northern Ireland Hospitality Industry Average Dividend Yield Market Cap Weighted Average of 32 Stocks 3.2%
United Kingdom of Great Britain and Northern Ireland Market Average Dividend Yield Market Cap Weighted Average of 705 Stocks 4.3%
United Kingdom of Great Britain and Northern Ireland Minimum Threshold Dividend Yield 10th Percentile 1%
United Kingdom of Great Britain and Northern Ireland Bottom 25% Dividend Yield 25th Percentile 2%
United Kingdom of Great Britain and Northern Ireland Top 25% Dividend Yield 75th Percentile 5.2%

Industry and Market average data is calculated daily.

Note all dividend per share amounts are annualized and not quarterly or other period.

LSE:IHG Future Dividends Estimate Data
Date (Data in $) Dividend per Share (annual) Avg. No. Analysts
2023-12-31 1.90 2.00
2022-12-31 1.70 2.00
2021-12-31 1.55 12.00
2020-12-31 1.42 15.00
2019-12-31 1.30 16.00
LSE:IHG Past Annualized Dividends Data
Date (Data in $) Dividend per share (annual) Avg. Yield (%)
2018-12-14 1.204 2.021
2018-03-01 1.095 1.735
2018-02-20 1.095 1.611
2017-05-05 3.260 5.472
2016-03-03 9.471 19.967
2016-02-23 9.471 19.380
2015-07-30 1.049 2.163
2015-02-26 4.881 8.956
2015-02-17 4.881 9.359
2014-08-05 4.815 9.424
2014-02-19 2.901 5.723
2013-02-19 0.915 2.137
2012-03-29 0.842 2.222
2012-02-14 0.842 2.425
2011-08-09 0.784 2.928
2011-05-10 1.170 3.919
2010-03-17 0.634 2.270

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • InterContinental Hotels Group has been paying a dividend for less than 10 years and during this time payments have been volatile (annual drop of over 20%).
  • Dividend payments have increased, but InterContinental Hotels Group only paid a dividend in the past 9 years.
Current Payout to shareholders
What portion of InterContinental Hotels Group's earnings are paid to the shareholders as a dividend.
  • Dividends paid are covered by earnings (1.6x coverage).
Future Payout to shareholders
  • Dividends after 3 years are expected to be well covered by earnings (2.4x coverage).
X
Income/ dividend checks
We assess InterContinental Hotels Group's dividend by checking for:
  1. Firstly is the company paying a notable dividend (greater than 1%) - if not then the rest of the checks are ignored.
  2. Is current dividend yield above the bottom 25% of dividend payers? (1 check)
  3. Is current dividend yield above the top 25% of dividend payers? (1 check)
  4. Have they paid a dividend for 10 years, and during this period has the dividend been volatile (drop of more than 25%)? (1 check)
  5. If they have paid a dividend for 10 years has it increased in this time? (1 check)
  6. How sustainable is the dividend, can InterContinental Hotels Group afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  7. InterContinental Hotels Group has a total score of 2/6, see the detailed checks below.


Full details on the Dividends part of the Simply Wall St company analysis model.

Management

 What is the CEO of InterContinental Hotels Group's salary, the management and board of directors tenure and is there insider trading?

Management is one of the most important areas of a company. We look at unreasonable CEO compensation, how long the team and board of directors have been around for and insider trading.
CEO
Keith Barr
COMPENSATION $3,093,000
AGE 47
TENURE AS CEO 1.8 years
CEO Bio

Mr. Keith Barr has been the Chief Executive Officer of Intercontinental Hotels Group plc since July 1, 2017. Mr. Barr served as the Chief Commercial Officer of Intercontinental Hotels Group plc since May 2013 until July 1, 2017. Mr. Barr served as the Chief Executive Officer of Greater China at Intercontinental Hotels Group plc until April 2013. Mr. Barr served as Regional Managing Director at Intercontinental Hotels Group plc since June 2009 and as its Chief Operating Officer of Greater China since November 2008. Mr. Barr serves as Chief Operating Officer for Australia, New Zealand and South Pacific of Intercontinental Hotels Group PLC. He oversees the day to day regional operations of the InterContinental, Crowne Plaza and Holiday Inn brands. Previously, he served as Vice President of Operations for Intercontinental Hotels Group's midscale brands, overseeing 175 hotels operating under the Holiday Inn, Staybridge Suites and Candlewood Suites brands in the United States and Canada and prior to that he was Vice President of Operations for the Holiday Inn brand in the U.S. During his 15 years in the hotel industry, he has specialized in revenue management and branded hotel operations. He joined Intercontinental Hotels Group plc in 2000. He has extensive experience with managing owner relationships and coordinating franchise administration. He counts among his key achievements the successful restructuring of IHG's U.S. operations for Holiday Inn and the integration of the acquired Bristol Hotels & Resorts into the Group. He spent more than 25 years working in the hospitality industry across a wide range of roles. He started his career in hotel operations and joined IHG in 2000. He was an integral part of the team that led Bristol's rapid expansion from 10 hotels to 120, to become the largest franchisee for the Holiday Inn and Crowne Plaza brands. A trained chef, he was also at one time a restaurant reviewer for the American Express restaurant award programme and the Mobil Travel Guide. He has been a Director of Intercontinental Hotels Group plc since July 1, 2017. He is member of Cornell University’s School of Hotel Administration Leland C. and Mary M. Pillsbury Institute for Hospitality Entrepreneurship Advisory Board. He has also previously on the Board of Directors for the Georgia Hospitality and Travel Association and the Board of Advisors for the Atlanta Chamber of Commerce.

CEO Compensation
  • Keith's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.
  • Keith's remuneration is about average for companies of similar size in United Kingdom of Great Britain and Northern Ireland.
Management Team Tenure

Average tenure and age of the InterContinental Hotels Group management team in years:

1.7
Average Tenure
47
Average Age
  • The average tenure for the InterContinental Hotels Group management team is less than 2 years, this suggests a new team.
Management Team

Keith Barr

TITLE
CEO & Director
COMPENSATION
$3M
AGE
47
TENURE
1.8 yrs

Paul Edgecliffe-Johnson

TITLE
CFO, Group Head of Strategy & Executive Director
COMPENSATION
$2M
TENURE
5.3 yrs

Elie Maalouf

TITLE
CEO of the Americas & Executive Director
COMPENSATION
$2M
TENURE
4.3 yrs

Laura Miller

TITLE
Chief Investment Officer
TENURE
1.3 yrs

George Turner

TITLE
Chief Commercial & Technology Officer
AGE
47
TENURE
0.3 yrs

Heather Wood

TITLE
VP & Head of Investor Relations

Nicolette Henfrey

TITLE
Executive VP
TENURE
0.3 yrs

Michael Torres

TITLE
Chief Communications Officer & VP of Corporate Communications - Americas Region

Claire Bennett

TITLE
Chief Marketing Officer
AGE
52
TENURE
1.6 yrs

Ranjay Radhakrishnan

TITLE
Chief Human Resources Officer
TENURE
2.4 yrs
Board of Directors Tenure

Average tenure and age of the InterContinental Hotels Group board of directors in years:

5.3
Average Tenure
56
Average Age
  • The tenure for the InterContinental Hotels Group board of directors is about average.
Board of Directors

Patrick Cescau

TITLE
Non-Executive Chairman of the Board
COMPENSATION
$442K
AGE
69
TENURE
6.3 yrs

Keith Barr

TITLE
CEO & Director
COMPENSATION
$3M
AGE
47
TENURE
1.8 yrs

Paul Edgecliffe-Johnson

TITLE
CFO, Group Head of Strategy & Executive Director
COMPENSATION
$2M
TENURE
5.3 yrs

Elie Maalouf

TITLE
CEO of the Americas & Executive Director
COMPENSATION
$2M
TENURE
1.3 yrs

Craig Hunt

TITLE
Vice-Chairman of Bass Hotels & Resorts Inc and Director of Bass Hotels & Resorts Inc

Jill McDonald

TITLE
Independent Non-Executive Director
COMPENSATION
$91K
AGE
52
TENURE
5.9 yrs

Ian Dyson

TITLE
Independent Non-Executive Director
COMPENSATION
$102K
AGE
56
TENURE
5.7 yrs

Jo Harlow

TITLE
Independent Non-Executive Director
COMPENSATION
$101K
AGE
56
TENURE
4.7 yrs

Dale Morrison

TITLE
Senior Independent Non-Executive Director
COMPENSATION
$173K
AGE
69
TENURE
5 yrs

Christopher Mayhew

TITLE
Independent Non-Executive Director
COMPENSATION
$76K
AGE
65
TENURE
7.8 yrs
Who owns this company?
Recent Insider Trading
  • InterContinental Hotels Group insiders have only sold shares in the past 3 months.
Recent Insider Transactions
Announced Type Name Entity Role Start End Shares Max Price (£) Value (£)
13. Mar 19 Sell Kenneth Macpherson Individual 11. Mar 19 11. Mar 19 -2,200 £45.21 £-99,459
13. Mar 19 Sell Jolyon Bulley Individual 11. Mar 19 11. Mar 19 -5,183 £45.21 £-234,317
13. Mar 19 Sell Yasmin Diamond Individual 11. Mar 19 11. Mar 19 -3,412 £45.21 £-154,252
26. Feb 19 Sell George Turner Individual 22. Feb 19 22. Feb 19 -10,000 £46.13 £-461,300
14. Aug 18 Sell Paul Edgecliffe-Johnson Individual 09. Aug 18 09. Aug 18 -14,725 £49.47 £-728,500
X
Management checks
We assess InterContinental Hotels Group's management by checking for:
  1. Is the CEO's compensation unreasonable compared to market cap? (1 check)
  2. Has the CEO's compensation increased more than 20% whilst the EPS is down more then 20%? (1 check)
  3. Is the average tenure of the management team less than 2 years? (1 check)
  4. Is the average tenure of the board of directors team less than 3 years? (1 check)
  5. InterContinental Hotels Group has a total score of 0/6, this is not included on the snowflake, see the detailed checks below.


Note: We use the top 6 management executives and board members in our calculations.

Note 2: Insider trading include any internal stakeholders and these transactions .

Full details on the Management part of the Simply Wall St company analysis model.

News

Simply Wall St News

Is InterContinental Hotels Group PLC's (LON:IHG) Growth Strong Enough To Justify Its May Share Price?

InterContinental Hotels Group PLC (LON:IHG) is considered a high-growth stock, but its last closing price of £48.5 left some investors wondering if this high future earnings potential can be rationalized by its current price tag. … This tells us that InterContinental Hotels Group is overvalued compared to the GB market average ratio of 16.45x , and overvalued based on current earnings compared to the Hospitality industry average of 18.07x. … So, when we include the growth factor in our analysis, InterContinental Hotels Group appears a bit overvalued , based on its fundamentals.

Simply Wall St -

Estimating The Fair Value Of InterContinental Hotels Group PLC (LON:IHG)

How far off is InterContinental Hotels Group PLC (LON:IHG) from its intrinsic value? … If you want to learn more about discounted cash flow, the rationale behind this calculation can be read in detail in the Simply Wall St analysis model? … Check out our latest analysis for InterContinental Hotels Group.

Simply Wall St -

What To Know Before Buying InterContinental Hotels Group PLC (LON:IHG) For Its Dividend

Dividend paying stocks like InterContinental Hotels Group PLC (LON:IHG) tend to be popular with investors, and for good reason - some research shows that a significant amount of all stock market returns come from reinvested dividends. … Yet sometimes, investors buy a popular dividend stock because of its yield, and then lose money if the company's dividend doesn't live up to expectations. … While InterContinental Hotels Group's 1.9% dividend yield is not the highest, we think its lengthy payment history is quite interesting.

Simply Wall St -

If You Had Bought InterContinental Hotels Group (LON:IHG) Shares Five Years Ago You'd Have A Total Return Of 175%

For example, long term InterContinental Hotels Group PLC (LON:IHG) shareholders have enjoyed a 69% share price rise over the last half decade, well in excess of the market return of around 3.3% (not including dividends). … InterContinental Hotels Group's earnings per share are down 0.7% per year, despite strong share price performance over five years. … In contrast revenue growth of 10% per year is probably viewed as evidence that InterContinental Hotels Group is growing, a real positive.

Simply Wall St -

Is Now The Time To Look At Buying InterContinental Hotels Group PLC (LON:IHG)?

Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price? … A question to answer is whether InterContinental Hotels Group's current trading price of £45.53 reflective of the actual value of the? … Let’s take a look at InterContinental Hotels Group’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change

Simply Wall St -

What Does InterContinental Hotels Group PLC's (LON:IHG) P/E Ratio Tell You?

We'll look at InterContinental Hotels Group PLC's (LON:IHG) P/E ratio and reflect on what it tells us about the company's share price. … Price to Earnings Ratio = Share Price (in reporting currency) ÷ Earnings per Share (EPS) … P/E of 31.02 = $60.33 (Note: this is the share price in the reporting currency, namely, USD ) ÷ $1.94

Simply Wall St -

Does The Hype Around InterContinental Hotels Group PLC's (LON:IHG) Growth Justify Its February Share Price?

InterContinental Hotels Group PLC (LON:IHG) is considered a high growth stock. … Check out our latest analysis for InterContinental Hotels Group? … InterContinental Hotels Group's extremely high growth potential in the near future is attracting investors

Simply Wall St -

InterContinental Hotels Group PLC (LON:IHG) Earns A Nice Return On Capital Employed

To be precise, we'll consider its Return On Capital Employed (ROCE), as that will inform our view of the quality of the business. … Understanding Return On Capital Employed (ROCE). … ROCE is a metric for evaluating how much pre-tax income (in percentage terms) a company earns on the capital invested in its business.

Simply Wall St -

InterContinental Hotels Group PLC (LON:IHG): Set To Experience A Decrease In Earnings?

In June 2018, InterContinental Hotels Group PLC (LON:IHG) released its earnings update. … analyst consensus outlook appear … with profits predicted to drop by -11% next year

Simply Wall St -

Need To Know: InterContinental Hotels Group PLC (LON:IHG) Insiders Have Been Selling Shares

So shareholders might well want to know whether insiders have been buying or selling shares in InterContinental Hotels Group PLC (LON:IHG). … InterContinental Hotels Group Insider Transactions Over The Last Year. … Over the last year we saw more insider selling of InterContinental Hotels Group shares, than buying

Simply Wall St -

Company Info

Description

InterContinental Hotels Group PLC owns, manages, franchises, and leases hotels in the Americas, Europe, Asia, the Middle East, Africa, and Greater China. The company operates hotels, resorts, and restaurants under the InterContinental, KIMPTON, Hotel Indigo, EVEN HOTELS, HUALUXE, Crowne Plaza, Holiday Inn, Holiday Inn Express, Holiday Inn Club Vacations, Holiday Inn Resort, avid, Staybridge Suites, Candlewood Suites, and InterContinental Hotels & Resorts brands. It also provides IHG Rewards Club, a hotel loyalty program. As of March 04, 2019, the company had approximately 5,600 hotels with 837,000 guest rooms. InterContinental Hotels Group PLC was founded in 1967 and is headquartered in Denham, the United Kingdom.

Details
Name: InterContinental Hotels Group PLC
IHG
Exchange: LSE
Founded: 1967
£9,148,421,024
180,691,705
Website: http://www.ihgplc.com
Address: InterContinental Hotels Group PLC
Broadwater Park,
Denham,
Buckinghamshire, UB9 5HR,
United Kingdom
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
LSE IHG Ordinary Shares London Stock Exchange GB GBP 31. Mar 2003
OTCPK ICHG.F Ordinary Shares Pink Sheets LLC US USD 31. Mar 2003
DB IC1G Ordinary Shares Deutsche Boerse AG DE EUR 31. Mar 2003
BATS-CHIXE IHGL Ordinary Shares BATS 'Chi-X Europe' GB GBP 31. Mar 2003
NYSE IHG SPON ADS EACH REPR 1 ORD SHS New York Stock Exchange US USD 08. Feb 1990
DB IC1B SPON ADS EACH REPR 1 ORD SHS Deutsche Boerse AG DE EUR 08. Feb 1990
Number of employees
Current staff
Staff numbers
12,812
InterContinental Hotels Group employees.
Industry
Hotels, Resorts and Cruise Lines
Consumer Services
Company Analysis and Financial Data Status
Area Date (UTC time)
Company Analysis updated: 2019/05/19 21:25
End of day share price update: 2019/05/17 00:00
Last estimates confirmation: 2019/05/15
Last earnings filing: 2019/02/28
Last earnings reported: 2018/12/31
Last annual earnings reported: 2018/12/31


All dates and times in UTC. All financial data provided by Standard & Poor’s Capital IQ.

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.