InterContinental Hotels Group (IHG) vs. Its Peers Financial Review

InterContinental Hotels Group (NYSE: IHG) is one of 30 publicly-traded companies in the “Hotels & motels” industry, but how does it contrast to its competitors? We will compare InterContinental Hotels Group to similar businesses based on the strength of its valuation, dividends, profitability, risk, analyst recommendations, institutional ownership and earnings.

Insider & Institutional Ownership

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6.7% of InterContinental Hotels Group shares are held by institutional investors. Comparatively, 70.3% of shares of all “Hotels & motels” companies are held by institutional investors. 17.4% of shares of all “Hotels & motels” companies are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Risk and Volatility

InterContinental Hotels Group has a beta of 1.31, suggesting that its share price is 31% more volatile than the S&P 500. Comparatively, InterContinental Hotels Group’s competitors have a beta of 1.15, suggesting that their average share price is 15% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings for InterContinental Hotels Group and its competitors, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
InterContinental Hotels Group 0 2 3 0 2.60
InterContinental Hotels Group Competitors 306 1441 2186 74 2.51

InterContinental Hotels Group presently has a consensus target price of $64.19, suggesting a potential upside of 3.70%. As a group, “Hotels & motels” companies have a potential upside of 0.65%. Given InterContinental Hotels Group’s stronger consensus rating and higher probable upside, equities research analysts plainly believe InterContinental Hotels Group is more favorable than its competitors.

Profitability

This table compares InterContinental Hotels Group and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
InterContinental Hotels Group N/A N/A N/A
InterContinental Hotels Group Competitors 10.97% 12.75% 4.81%

Earnings and Valuation

This table compares InterContinental Hotels Group and its competitors top-line revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
InterContinental Hotels Group $1.78 billion $592.00 million 25.47
InterContinental Hotels Group Competitors $3.57 billion $470.05 million 186.45

InterContinental Hotels Group’s competitors have higher revenue, but lower earnings than InterContinental Hotels Group. InterContinental Hotels Group is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Dividends

InterContinental Hotels Group pays an annual dividend of $1.67 per share and has a dividend yield of 2.7%. InterContinental Hotels Group pays out 68.7% of its earnings in the form of a dividend. As a group, “Hotels & motels” companies pay a dividend yield of 1.8% and pay out 48.0% of their earnings in the form of a dividend. InterContinental Hotels Group has increased its dividend for 5 consecutive years.

Summary

InterContinental Hotels Group competitors beat InterContinental Hotels Group on 8 of the 14 factors compared.

About InterContinental Hotels Group

InterContinental Hotels Group PLC owns, manages, franchises, and leases hotels in the Americas, Europe, Asia, the Middle East, Africa, and Greater China. The company operates hotels, resorts, and restaurants under the InterContinental, Kimpton, Hotel Indigo, EVEN, HUALUXE, Crowne Plaza, Holiday Inn, Holiday Inn Express, Holiday Inn Club Vacations, Holiday Inn Resort, avid, Staybridge Suites, and Candlewood Suites brands. It also provides IHG Rewards Club, a hotel loyalty program. As of December 31, 2017, the company had 5,348 hotels with 798,075 rooms. InterContinental Hotels Group PLC was founded in 1967 and is headquartered in Denham, the United Kingdom.

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