CHH Stock Fair Value Calculation – Long-Term Growth Potential: Why Choice Hotels International is a Top Stock Pick
January 5, 2024
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Investors looking for a solid long-term stock pick should consider Choice Hotels International ($NYSE:CHH). This leading hotel franchise system has a long track record of growth and success, making it an attractive investment option. With a focus on quality, value, and reliability, the company has a portfolio of iconic brands such as Comfort Inn, Comfort Suites, Quality, Sleep Inn, Clarion, Cambria Hotels, MainStay Suites, Suburban Extended Stay Hotel, EconoLodge, Rodeway Inn, and Ascend Hotel Collection. With its promising portfolio of iconic brands, steadfast commitment to quality, and dedication to expansion in both domestic and international markets, Choice Hotels International is sure to be a reliable and successful investment for years to come.
Price History
On Tuesday, CHI stock opened at $111.1 and closed at $114.1, up by 0.7% from its prior closing price of 113.3. This trend is indicative of the company’s optimism and potential for future success. CHI is well-known for its extensive portfolio of hotels, ranging from economy to upscale offerings. This impressive coverage gives CHI a strong market presence and a competitive advantage over other hotel chains. Another factor driving long-term growth potential is the company’s commitment to innovation. CHI is constantly looking for ways to make their services more efficient and customer-friendly.
To that end, they have implemented a guest loyalty program, upgraded their booking platform, and invested in digital marketing. All of these initiatives are aimed at improving customer experience and making the brand more attractive to travelers. CHI also has a strong financial performance. This shows that the company is making good use of its resources and has the potential to generate further returns in the coming years. With an extensive portfolio of hotels and a strong financial performance, investors can expect to see returns in the near future. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for CHH. More…
| Total Revenues | Net Income | Net Margin |
| 1.55k | 283.48 | 18.4% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for CHH. More…
| Operations | Investing | Financing |
| 349.05 | -62.03 | -303.67 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for CHH. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 2.23k | 2.16k | 1.45 |
Key Ratios Snapshot
Some of the financial key ratios for CHH are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 22.2% | 32.2% | 27.8% |
| FCF Margin | ROE | ROA |
| 15.6% | 422.6% | 12.0% |
Analysis – CHH Stock Fair Value Calculation
GoodWhale recently conducted an analysis of CHOICE HOTELS INTERNATIONAL’s fundamentals for investors. Our proprietary Valuation Line revealed that the fair value of CHOICE HOTELS INTERNATIONAL share is around $175.1. However, at the moment it is currently traded at $114.1, representing an undervaluation of 34.8%. This suggests an opportunity for potential investors to enter the market and take advantage of the current trading price. We suggest investors consider the current situation in order to decide if it is a good time to purchase CHOICE HOTELS INTERNATIONAL stock. More…
Peers
Choice Hotels International, Inc. is one of the world’s largest hotel companies. With over 6,300 hotels across more than 35 countries and territories, Choice Hotels International offers a wide variety of lodging options to suit any need. Wyndham Hotels & Resorts, Hilton Worldwide Holdings, and Marriott International are all major competitors in the hotel industry.
– Wyndham Hotels & Resorts Inc ($NYSE:WH)
Wyndham Hotels & Resorts Inc is one of the largest hotel companies in the world, with over 7,500 hotels across more than 80 countries. The company offers a wide range of hotel brands, from economy to luxury, and its portfolio includes some of the most well-known hotel brands in the world, such as Wyndham, Ramada, Days Inn, and Super 8. Wyndham Hotels & Resorts is headquartered in Parsippany, New Jersey.
The company’s market cap is 6.2B as of 2022 and its ROE is 30.65%.
– Hilton Worldwide Holdings Inc ($NYSE:HLT)
Hilton Worldwide Holdings Inc. is a hospitality company that owns, leases, manages, develops, and franchises hotels and resorts. The company operates in three segments: Owned and Leased Hotels, Management and Franchise, and Timeshare. As of December 31, 2020, it owned, leased, or managed 2,084 properties with 883,944 rooms. Hilton Worldwide Holdings Inc. was founded in 1919 and is headquartered in McLean, Virginia.
– Marriott International Inc ($NASDAQ:MAR)
Marriott International is one of the world’s largest hotel companies, with more than 6,000 properties in over 120 countries and territories. Marriott operates and franchises hotels and timeshare properties under 30 brands, including Marriott, Ritz-Carlton, Sheraton, and Westin. The company also has a vacation ownership division, Marriott Vacations Worldwide. Marriott was founded in 1927 by J. Willard Marriott and Frank J. Taylor.
Summary
Choice Hotels International is an attractive long-term investment with strong growth potential. The company has a strong history of profitability and has a well-diversified portfolio of hotels across different geographies. Its competitive advantages include an extensive loyalty program, an industry leading franchise model, and a robust technology platform. In terms of financials, Choice Hotels International has consistently improved its revenue, margins, cash flow, and return on equity. The company also has a strong balance sheet with minimal debt and a strong dividend yield.
Additionally, it has significant growth opportunities in the near future with its focus on global expansion, acquisitions, and strategic partnerships.
