HST

Read This to Understand Host Hotels & Resorts Stock

It hasn't been a great morning session for Host Hotels & Resorts investors, who have watched their shares sink by -3.6% to a price of $18.16. Some of you might be wondering if it's time to buy the dip. If you are considering this, make sure to check the company's fundamentals first to determine if the shares are fairly valued at today's prices.

a Lower P/E Ratio Than Its Sector Average but Priced Beyond Its Margin of Safety:

Host Hotels & Resorts, Inc. is an S&P 500 company and is the largest lodging real estate investment trust and one of the largest owners of luxury and upper-upscale hotels. The company belongs to the Real Estate sector, which has an average price to earnings (P/E) ratio of 25.55 and an average price to book (P/B) ratio of 2.1. In contrast, Host Hotels & Resorts has a trailing 12 month P/E ratio of 17.5 and a P/B ratio of 1.9.

When we divideHost Hotels & Resorts's P/E ratio by its expected five-year EPS growth rate, we obtain a PEG ratio of 0.64, which indicates that the market is undervaluing the company's projected growth (a PEG ratio of 1 indicates a fairly valued company). Your analysis of the stock shouldn't end here. Rather, a good PEG ratio should alert you that it may be worthwhile to take a closer look at the stock.

The Company's Revenues Are Declining:

2018 2019 2020 2021 2022 2023
Revenue (M) $5,524 $5,469 $1,620 $2,890 $4,907 $5,311
Operating Margins 10% 15% -59% -9% 16% 16%
Net Margins 20% 17% -45% 0% 13% 14%
Net Income (M) $1,087 $920 -$732 -$11 $633 $740
Net Interest Expense (M) $176 $222 $194 $191 $156 $191
Depreciation & Amort. (M) $944 $676 $665 $762 $664 $697
Diluted Shares (M) 7,406 7,311 7,059 7,103 7,175 7,128
Earnings Per Share $1.47 $1.26 -$1.04 -$0.02 $0.88 $1.04
EPS Growth n/a -14.29% -182.54% 98.08% 4500.0% 18.18%
Avg. Price $17.32 $16.26 $11.96 $15.75 $17.58 $18.39
P/E Ratio 11.78 12.9 -11.5 -787.5 19.75 17.68
Free Cash Flow (M) $1,100 $914 -$650 -$1 $1,109 $1,246
CAPEX (M) $200 $336 $343 $293 $307 $195
EV / EBITDA 16.6 15.47 -51.75 42.44 17.33 16.9
Total Debt (M) $455 $445 $442 $436 $758 $746
Net Debt / EBITDA -0.74 -0.76 6.57 -0.72 0.06 -0.26
The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.

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