Stock Analysis

When Should You Buy Wyndham Hotels & Resorts, Inc. (NYSE:WH)?

  •  Updated
NYSE:WH
Source: Shutterstock

Wyndham Hotels & Resorts, Inc. (NYSE:WH), might not be a large cap stock, but it saw a significant share price rise of over 20% in the past couple of months on the NYSE. As a mid-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. However, could the stock still be trading at a relatively cheap price? Let’s take a look at Wyndham Hotels & Resorts’s outlook and value based on the most recent financial data to see if the opportunity still exists.

Check out our latest analysis for Wyndham Hotels & Resorts

What's the opportunity in Wyndham Hotels & Resorts?

The stock seems fairly valued at the moment according to my valuation model. It’s trading around 9.0% below my intrinsic value, which means if you buy Wyndham Hotels & Resorts today, you’d be paying a reasonable price for it. And if you believe the company’s true value is $67.58, then there isn’t much 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 Wyndham Hotels & Resorts’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.

Can we expect growth from Wyndham Hotels & Resorts?

earnings-and-revenue-growth
NYSE:WH Earnings and Revenue Growth January 13th 2021

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. In Wyndham Hotels & Resorts' case, its revenues over the next few years are expected to grow by 80%, indicating a highly optimistic future ahead. If expense does not increase by the same rate, or higher, this top line growth should lead to stronger cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? WH’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 WH, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the positive outlook 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 want to dive deeper into Wyndham Hotels & Resorts, you'd also look into what risks it is currently facing. When we did our research, we found 2 warning signs for Wyndham Hotels & Resorts (1 shouldn't be ignored!) that we believe deserve your full attention.

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

If you decide to trade Wyndham Hotels & Resorts, use the lowest-cost* platform that is rated #1 Overall by Barron’s, Interactive Brokers. Trade stocks, options, futures, forex, bonds and funds on 135 markets, all from a single integrated account. Promoted


What are the risks and opportunities for Wyndham Hotels & Resorts?

Wyndham Hotels & Resorts, Inc. operates as a hotel franchisor worldwide.

View Full Analysis

Rewards

  • Earnings are forecast to grow 4.36% per year

  • Earnings grew by 85.1% over the past year

Risks

  • Significant insider selling over the past 3 months

  • Has a high level of debt

View all Risks and Rewards

Share Price

Market Cap

1Y Return

View Company Report

Further research on
Wyndham Hotels & Resorts

ValuationFinancial HealthInsider TradingManagement Team