Hilton Grand Vacations Company, LLC. is a division of Hilton Worldwide. Based in Orlando, Fla, Hilton Grand Vacations develops, markets and operates a system of brand name, vacation ownership resorts in select vacation destinations. The company also manages and operates two club membership programs: Hilton Grand Vacations Club® and The Hilton Club®, providing exclusive exchange, leisure travel, and reservation services.
HGV Price Forecast Based on DCF Valuation
DCF Fair Value Target:
The table below illustrates the output of a discounted cash flow forecast using a variety of scenarios for Hilton Grand Vacations Inc. To summarize, we found that Hilton Grand Vacations Inc ranked in the 28th percentile in terms of potential gain offered. Our DCF analysis suggests the stock is overvalued by about 37.67%. In terms of the factors that were most noteworthy in this DCF analysis for HGV, they are:
The company's debt burden, as measured by earnings divided by interest payments, is 7.35 -- which is good for besting 64.11% of its peer stocks (US stocks in the Consumer Cyclical sector with positive cash flow).
Its compound free cash flow growth rate, as measured over the past 3.75 years, is -0.08% -- higher than just 18.93% of stocks in our DCF forecasting set.
Hilton Grand Vacations Inc's weighted average cost of capital (WACC) is 6%; for context, that number is higher than only 4.5% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Consumer Cyclical that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as HGV, try MCD, PBPB, KBAL, SERV, and SMP.