Stock Analysis

When Should You Buy Hilton Worldwide Holdings Inc. (NYSE:HLT)?

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NYSE:HLT
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Let's talk about the popular Hilton Worldwide Holdings Inc. (NYSE:HLT). The company's shares received a lot of attention from a substantial price increase on the NYSE over the last few months. As a large-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. But what if there is still an opportunity to buy? Let’s take a look at Hilton Worldwide Holdings’s outlook and value based on the most recent financial data to see if the opportunity still exists.

View our latest analysis for Hilton Worldwide Holdings

Is Hilton Worldwide Holdings still cheap?

According to my valuation model, Hilton Worldwide Holdings seems to be fairly priced at around 1.30% above my intrinsic value, which means if you buy Hilton Worldwide Holdings today, you’d be paying a relatively fair price for it. And if you believe that the stock is really worth $159.16, then there isn’t really any room for the share price grow beyond what it’s currently trading. Although, there may be an opportunity to buy in the future. This is because Hilton Worldwide Holdings’s beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company’s shares will likely fall by more than the rest of the market, providing a prime buying opportunity.

What kind of growth will Hilton Worldwide Holdings generate?

earnings-and-revenue-growth
NYSE:HLT Earnings and Revenue Growth April 29th 2022

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. 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. Hilton Worldwide Holdings' earnings over the next few years are expected to double, indicating a very optimistic future ahead. This should lead to stronger cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? HLT’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 conviction to buy should the price fluctuates below the true value?

Are you a potential investor? If you’ve been keeping an eye on HLT, now may not be the most optimal 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 further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

In light of this, if you'd like to do more analysis on the company, it's vital to be informed of the risks involved. When we did our research, we found 3 warning signs for Hilton Worldwide Holdings (1 makes us a bit uncomfortable!) that we believe deserve your full attention.

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

What are the risks and opportunities for Hilton Worldwide Holdings?

Hilton Worldwide Holdings Inc., a hospitality company, owns, leases, manages, develops, and franchises hotels and resorts.

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Rewards

  • Trading at 11.2% below our estimate of its fair value

  • Earnings are forecast to grow 14.55% per year

  • Earnings grew by 2653.8% over the past year

Risks

  • Debt is not well covered by operating cash flow

  • Negative shareholders equity

  • Significant insider selling over the past 3 months

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Share Price

Market Cap

1Y Return

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Further research on
Hilton Worldwide Holdings

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