What Does Hyatt Hotels Corporation's (NYSE:H) Share Price Indicate?

Hyatt Hotels Corporation (NYSE:H), might not be a large cap stock, but it saw a decent share price growth in the teens level on the NYSE over the last few months. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. But what if there is still an opportunity to buy? Today I will analyse the most recent data on Hyatt Hotels’s outlook and valuation to see if the opportunity still exists.

Check out our latest analysis for Hyatt Hotels

What is Hyatt Hotels worth?

According to my valuation model, Hyatt Hotels seems to be fairly priced at around 16% below my intrinsic value, which means if you buy Hyatt Hotels today, you’d be paying a reasonable price for it. And if you believe that the stock is really worth $105.41, then there’s not much of an upside to gain from mispricing. Is there another opportunity to buy low in the future? Since Hyatt Hotels’s share price is quite volatile, we could potentially see it sink lower (or rise higher) in the future, giving us another chance to buy. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.

What does the future of Hyatt Hotels look like?

Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. With profit expected to more than double over the next couple of years, the future seems bright for Hyatt Hotels. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.

What this means for you:

Are you a shareholder? H’s optimistic future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough confidence to invest in the company should the price drop below its fair value?

Are you a potential investor? If you’ve been keeping an eye on H, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the optimistic prospect is encouraging for the company, which means it’s worth diving deeper into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

If you'd like to know more about Hyatt Hotels as a business, it's important to be aware of any risks it's facing. Be aware that Hyatt Hotels is showing 4 warning signs in our investment analysis and 1 of those is potentially serious...

If you are no longer interested in Hyatt Hotels, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.