Park Hotels & Resorts (NYSE:PK) - Share price, News & Analysis

Q: What is the Fair Price of PK when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

PK ($15.05) is trading below our estimate of [[fair value]] ($79.55)

PK fundamental analysis
Snowflake Score
Valuation	5/6
Future Growth	4/6
Past Performance	0/6
Financial Health	1/6
Dividends	0/6

PK Stock Overview

Park is the second largest publicly traded lodging REIT with a diverse portfolio of market-leading hotels and resorts with significant underlying real estate value.

Rewards

Trading at 81.1% below our estimate of its fair value

Earnings are forecast to grow 90.66% per year

Risk Analysis

Interest payments are not well covered by earnings

Park Hotels & Resorts Competitors

Pebblebrook Hotel Trust

NYSE:PEB

US$2.5b

Sunstone Hotel Investors

NYSE:SHO

US$2.3b

Apple Hospitality REIT

NYSE:APLE

US$3.7b

RLJ Lodging Trust

NYSE:RLJ

US$2.0b

Price History & Performance

Summary of all time highs, changes and price drops for Park Hotels & Resorts
Historical stock prices
Current Share Price	US$15.05
52 Week High	US$21.62
52 Week Low	US$12.90
Beta	1.98
1 Month Change	9.30%
3 Month Change	-16.25%
1 Year Change	-19.82%
3 Year Change	-39.02%
5 Year Change	-42.34%
Change since IPO	-48.10%

Shareholder Returns

	PK	US REITs	US Market
7D	-3.5%	-1.9%	1.0%
1Y	-19.8%	-8.0%	-12.9%

Return vs Industry: PK underperformed the US REITs industry which returned -8% over the past year.

Return vs Market: PK underperformed the US Market which returned -12.9% over the past year.

Price Volatility

Is PK's price volatile compared to industry and market?
PK volatility
PK Average Weekly Movement	7.4%
REITs Industry Average Movement	4.4%
Market Average Movement	7.9%
10% most volatile stocks in US Market	17.2%
10% least volatile stocks in US Market	3.2%

Stable Share Price: PK is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 7% a week.

Volatility Over Time: PK's weekly volatility (7%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
n/a	80	Tom Baltimore	https://www.pkhotelsandresorts.com

Park is the second largest publicly traded lodging REIT with a diverse portfolio of market-leading hotels and resorts with significant underlying real estate value. Park’s portfolio currently consists of 60 premium-branded hotels and resorts with over 33,000 rooms primarily located in prime city center and resort locations.

Park Hotels & Resorts Fundamentals Summary

How do Park Hotels & Resorts's earnings and revenue compare to its market cap?
PK fundamental statistics
Market Cap	US$3.38b
Earnings (TTM)	-US$60.00m
Revenue (TTM)	US$2.05b

1.6x

P/S Ratio

-56.4x

P/E Ratio

Is PK overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
PK income statement (TTM)
Revenue	US$2.05b
Cost of Revenue	US$1.50b
Gross Profit	US$551.00m
Other Expenses	US$611.00m
Earnings	-US$60.00m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	-0.27
Gross Margin	26.85%
Net Profit Margin	-2.92%
Debt/Equity Ratio	109.1%

How did PK perform over the long term?

See historical performance and comparison

Dividends

0.3%

Current Dividend Yield

1%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is PK undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

Price-To-Sales vs Peers
Price-To-Sales vs Industry
Price-To-Sales vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for PK?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for PK. This is calculated by dividing PK's market cap by their current preferred multiple.
What is PK's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	US$3.38b

PK key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	3.7x
Enterprise Value/EBITDA	18.6x
PEG Ratio	n/a

Price to Sales Ratio vs Peers

How does PK's PS Ratio compare to its peers?

PK PS Ratio vs Peers

The above table shows the PS ratio for PK vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PS	Estimated Growth	Market Cap
Peer Average	2.6x
PEB Pebblebrook Hotel Trust	2.2x	9.9%	US$2.5b
SHO Sunstone Hotel Investors	3.1x	7.7%	US$2.3b
APLE Apple Hospitality REIT	3.3x	4.1%	US$3.7b
RLJ RLJ Lodging Trust	1.9x	11.4%	US$2.0b
PK Park Hotels & Resorts	1.6x	10.1%	US$3.4b

Price-To-Sales vs Peers: PK is good value based on its Price-To-Sales Ratio (1.6x) compared to the peer average (2.6x).

Price to Earnings Ratio vs Industry

How does PK's PE Ratio compare vs other companies in the US REITs Industry?

Price-To-Sales vs Industry: PK is good value based on its Price-To-Sales Ratio (1.6x) compared to the US REITs industry average (5.8x)

Price to Sales Ratio vs Fair Ratio

What is PK's PS Ratio compared to its Fair PS Ratio? This is the expected PS Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

PK PS Ratio vs Fair Ratio.
Fair Ratio
Current PS Ratio	1.6x
Fair PS Ratio	2.1x

Price-To-Sales vs Fair Ratio: PK is good value based on its Price-To-Sales Ratio (1.6x) compared to the estimated Fair Price-To-Sales Ratio (2.1x).

Share Price vs Fair Value

What is the Fair Price of PK when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: PK ($15.05) is trading below our estimate of fair value ($79.55)

Significantly Below Fair Value: PK is trading below fair value by more than 20%.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is more than 20% higher than the current share price, but analysts are not within a statistically confident range of agreement.

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Future Growth

How is Park Hotels & Resorts forecast to perform in the next 1 to 3 years based on estimates from 12 analysts?

Future Growth Score

4/6

Future Growth Score 4/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

90.7%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: PK is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (1.9%).

Earnings vs Market: PK is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: PK is expected to become profitable in the next 3 years.

Revenue vs Market: PK's revenue (10.1% per year) is forecast to grow faster than the US market (7.9% per year).

High Growth Revenue: PK's revenue (10.1% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: PK's Return on Equity is forecast to be low in 3 years time (3.9%).

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Past Performance

How has Park Hotels & Resorts performed over the past 5 years?

Past Performance Score

0/6

Past Performance Score 0/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-69.5%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: PK is currently unprofitable.

Growing Profit Margin: PK is currently unprofitable.

Past Earnings Growth Analysis

Earnings Trend: PK is unprofitable, and losses have increased over the past 5 years at a rate of 69.5% per year.

Accelerating Growth: Unable to compare PK's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: PK is unprofitable, making it difficult to compare its past year earnings growth to the REITs industry (47.6%).

Return on Equity

High ROE: PK has a negative Return on Equity (-1.14%), as it is currently unprofitable.

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Financial Health

How is Park Hotels & Resorts's financial position?

Financial Health Score

1/6

Financial Health Score 1/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: PK's short term assets ($1.1B) exceed its short term liabilities ($211.0M).

Long Term Liabilities: PK's short term assets ($1.1B) do not cover its long term liabilities ($5.2B).

Debt to Equity History and Analysis

Debt Level: PK's net debt to equity ratio (91.4%) is considered high.

Reducing Debt: PK's debt to equity ratio has increased from 49.1% to 109.1% over the past 5 years.

Debt Coverage: PK's debt is not well covered by operating cash flow (4.6%).

Interest Coverage: PK's interest payments on its debt are not well covered by EBIT (0.5x coverage).

Balance Sheet

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Dividend

What is Park Hotels & Resorts's current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

0.27%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: PK's dividend (0.27%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.52%).

High Dividend: PK's dividend (0.27%) is low compared to the top 25% of dividend payers in the US market (4.09%).

Stability and Growth of Payments

Stable Dividend: PK is not paying a notable dividend for the US market, therefore no need to check if payments are stable.

Growing Dividend: PK is not paying a notable dividend for the US market, therefore no need to check if payments are increasing.

Earnings Payout to Shareholders

Earnings Coverage: PK is not paying a notable dividend for the US market.

Cash Payout to Shareholders

Cash Flow Coverage: PK is not paying a notable dividend for the US market.

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Management

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

4.2yrs

Average management tenure

CEO

Tom Baltimore (59 yo)

5.67yrs

Tenure

US$9,412,399

Compensation

Mr. Thomas Jeremiah Baltimore Jr., also known as Tom, has been the Chief Executive Officer and President at Park Hotels & Resorts Inc. since January 2017. Mr. Baltimore’s knowledge of extensive experience...

CEO Compensation Analysis

Compensation vs Market: Tom's total compensation ($USD9.41M) is above average for companies of similar size in the US market ($USD6.58M).

Compensation vs Earnings: Tom's compensation has been consistent with company performance over the past year.

Leadership Team

Experienced Management: PK's management team is considered experienced (4.2 years average tenure).

Board Members

Experienced Board: PK's board of directors are considered experienced (5.6 years average tenure).

Ownership

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

Insider Trading Volume

Insider Buying: PK insiders have bought more shares than they have sold in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/08/07 00:00
End of Day Share Price	2022/08/05 00:00
Earnings	2022/06/30
Annual Earnings	2021/12/31